There is some concern about Greece’s current debt strait causing it to leave the EU, and there is additional concern about “contagion” spreading—that with the precedent set, other members might leave, also. Mark Dowding, BlueBay Asset Management’s co-head of investment grade and a senior portfolio manager, offered this, for instance:
If we get a Greek exit, you have to say the potential for other countries to exit the eurozone is suddenly no longer negligible. That would need to be reflected in bond prices.
It’s certainly true that the potential for others leaving is no longer negligible. However, it’s neither sudden—the possibility has been there for years—nor is it much higher than negligible. The only nations with any non-zero likelihood of leaving at all are the remaining PIIGS, and they’ve either already been through their crises (Ireland, for instance), or they’ve already begun taking steps, however halting, to improve their financial situation.