Ukip leader Nigel Farage has claimed that the Greek referendum result showed that the European Union was “dying”.

Greeks voted by about 61 per cent to 39 per cent to reject a package of austerity measures sought by the EU in exchange for a continuation of vast bailout loans.

Urgent negotiations were due to take place over the next few days to secure a better deal for Greece, but several analysts speculated that the most likely outcome was the country’s exit from the euro.

That would lead to significant inflation as Greece’s new currency devalued against the euro and imports became more expensive, heaping further pain on a population reeling from years of economic decline.

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