An emergency summit of leaders from eurozone nations will be held tomorrow after the latest attempt to resolve the Greek debt crisis failed.

A meeting of finance ministers last Thursday made no breakthrough. Unless Greece agrees to economic reforms with its creditors, officials believe time will run out for Athens to receive the desperately needed €7.2 billion remaining in its bailout programme, which will expire on June 30.

Separately, Greece has to fund the money to repay €1.6 billion to the International Monetary Fund also by the June 30 deadline.

For Greece, the gains from defaulting would be slight while the costs would be exorbitant: bank failures, slashed value of savings, broken contracts and shattered confidence.

In the meantime, in its monthly monetary policy meeting, the Federal Reserve (Fed) last week kept its benchmark interest rate unchanged near zero and offered no explicit guidance to indicate that it will soon raise interest rates from their current record low levels.

Many market watchers thought the Fed would lay further groundwork for a rate hike as soon as September. Only two of 17 Fed officials want to wait until 2016 to hike, but the decision to hold off for now was unanimous.

A September rate hike is by no means off the table, as members want to see two modest rate hikes before year’s end. While downward pressure on inflation is ‘abating’, the inflation rate is not expected to rise to the Fed’s two per cent target until 2017.

Finally, Germany’s producer prices fell more than expected in May, data released by the German statistics office showed last week. Producer prices declined by 1.3 per cent in May compared to the same month last year.

However, this fall in producer prices was slower than the 1.5 per cent drop seen in April and 1.7 per cent fall in March. Nonetheless, the annual pace of decline was bigger than a 1.1 per cent fall forecast by economists.

German producer prices have been falling since August 2013. Excluding energy, producer prices were down 0.3 per cent.

This report was compiled by Bank of Valletta plc for general information purposes only.