Greece may complete its proposed bond-exchange to reduce outstanding debt without resorting to use of collective-action clauses that would trigger credit- default-swap contracts, according to Goldman Sachs Group Inc. (GS)

“The market consensus is that CACs will be activated, forcing a default and triggering CDS,” Francesco Garzarelli, co-head of fixed-income strategy in London, wrote in a note to clients today. “A voluntary participation rate in the exchange above 75 percent cannot be ruled out,” and Greece has indicated that may be sufficient for the transaction to be “completed without CACs, subject to consent from” Greece’s European Monetary Union partners, he wrote.

“If this is the case and Greece ends up not activating CACs-CDS, this would represent a positive outcome for broader markets,” Garzarelli said.

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