EU to hold back $1.2B of Greek tranche

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BRUSSELS, May 9 (UPI) -- European Union officials said Wednesday they would hold back $1.2 billion from Thursday's aid package designated for Greece.

"The board has confirmed the release of the outstanding amount of $6.7 billion from the first installment of $50.9 billion by the end of June," the European Financial Stability Fund said in a statement. However, it said, "An amount of $5.4 billion will be disbursed on 10 May. The remaining funds of $1.2 [billion] are not needed before June and will be disbursed depending on the financing needs of Greece."

The Guardian reported Wednesday radical left leader Alexis Tsipris in Athens announced efforts to form a coalition government had failed, which means, barring an 11th-hour turnaround, Greeks will likely go to the polls a second time to elect representatives that can create a coalition party.

Leftists and independents in Greece said Sunday's vote confirmed that 68 percent of the country voted against continuing with the bailout deal put together by the European Union and the International Monetary Fund.

However, Fotis Kouvelis of the Democratic Left, which earned 6 percent of Sunday's vote, said he would only back a new coalition government if it was a majority coalition, The Guardian reported.

Economic forecaster Nouriel Roubini said Europe resembled a "slow motion train wreck."

"Europe will be lucky if it ends up in stagnation like Japan for the next 10 years," CNBC quoted Roubini as saying.