The International Monetary Fund announced Thursday that "major differences" remain with Greece over negotiations to save Athens from bankruptcy, Reuters reported, a sharp contradiction from separate reports earlier this week that were optimistic about the ongoing bailout negotiations.
"There are major differences between us in most key areas," IMF spokesman Gerry Rice told reporters, according to the Reuters report. "There has been no progress in narrowing these differences recently, and thus we are well away from an agreement." Rice said Greece and its creditors are deadlocked over pensions, taxes and financing.
The announcement comes a day after Standard & Poor's cut Greece's long-term credit rating to "CCC" from "CCC positive," adding the Greek government would likely default on its commercial debt in the next 12 months in the absence of an agreement with creditors.
Greece’s current bailout program expires June 30. The Greek government chose to delay a debt payment last week and instead decided to bundle four installments due to the IMF at the end of the month into a single 1.6 billion euro ($1.8 billion) lump sum.
The Greek crisis escalated further Thursday as IMF officials left Brussels to head back to Washington following tense negotiations with Greek Prime Minister Alexis Tsipras. "There is no more time for gambling. The day is coming, I'm afraid, that someone says that the game is over," European Council President Donald Tusk said during a press conference after attending an EU-Latin America summit.
However, experts are still optimistic Greece and its creditors will strike a deal.
"Our expectation is something will get hammered out this month so Greece can either meet those obligations or extend again because it's still too important for both sides to get a deal done," said Tim Dreiling, senior portfolio manager at the Private Client Reserve at U.S. Bank.