With the arrest of a neo-Nazi leader on Saturday, the Greek government is sending a message of strength despite longstanding financial turmoil to many at home and abroad, analysts claim.

"This is not just a message for internal use, to show that it puts a halt to violence, this is a message directed outwards, to Europe and others," said political analyst Ilias Nikolakopoulos.

Police swooped on the neo-Nazi party chief Nikos Michaloliakos and his deputies 10 days after the murder of an anti-fascist musician, allegedly by a member of the Golden Dawn party, an act that shocked Greece and made headlines around the world.

The Greek government coalition has been repeatedly accused of being too lenient with the neo-Nazis, but the arrests show its ability to act on a social issue even at a time of protracted economic crisis.

The arrests come just as Greece once again faces close scrutiny by European leaders and international bankers.

The IMF is part of the so-called "troika", alongside the European Union and the European Central Bank, that will examine Greece's latest accounts. It is expected that this latest audit will result in the release of a new tranche of one billion euros ($1.3 billion) to Athens.

In a Saturday meeting with members of the troika, Samaras and his ministers were said to have described in detail the latest developments concerning Golden Dawn.

Finance Minister Yannis Stournaras gave assurances that Greece's democracy is strong enough to address issues concerning Golden Dawn.

"The government took the opportunity, with the murder of musician, to enforce laws that existed but were (previously) not implemented," said Manos Papazoglou, a political scientist at the University of Peloponnese.

"This is a message for Greece and for the whole world, to say that Greece is a democratic country, and it does not accept that which defies democracy."

Formerly on the fringe of Greek politics, Golden Dawn has skyrocketed to popularity by tapping into widespread anger over unpopular reforms in a country that is currently slogging through its sixth year of recession.

But there was widespread outrage following the murder of the anti-fascist rapper, Pavlos Fyssas, 34, who was stabbed to death on September 18 in a suburb near Athens.

"This incident is shocking and unacceptable, especially in a country of the European Union," said the president of the Socialist group in the European Parliament, Hannes Swoboda.

"If the Greek government and the Prime Minister Antonis Samaras fails to stop the awful behaviour of Golden Dawn and other fascist groups, the (Greek) presidency is unacceptable," he said as Athens gets set to assume the rotating EU presidency in January.

For political analyst G