Sunday 23 October 2011

Merkel expects breakthrough on euro zone crisis Wednesday

No doubt we can expect this theatre to continue for another week or so.

(Reuters) - German Chancellor Angela Merkel said she expected a breakthrough in efforts to come up with a comprehensive response to the euro zone debt crisis on Wednesday, after EU finance ministers made progress in talks on recapitalizing banks.

"We have to take far-reaching decisions. These have to be prepared properly, I believe that the finance ministers made progress, so that we can achieve our ambitious targets by Wednesday," Merkel told reporters.

Euro zone countries are working on a plan that involves leveraging the euro zone bailout fund, recapitalizing European banks and putting together a second financing package for Greece that entails deeper losses for private investors.

Euro zone leaders hope the measures will ease market anxiety over euro zone sovereign debt and put an end to the two-year-old crisis that now threatens the global economy.

Euro zone leaders meet on Sunday to discuss the package but real decisions will only come at the next summit on Wednesday.

"The breakthrough... will be on Wednesday," Merkel said.

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