Gerald
07-21-11, 07:42 AM
German Chancellor Angela Merkel and French President Nicolas Sarkozy have hammered out a common position on the euro debt crisis.
A statement by the French president's office said agreement had been reached after seven hours of talks in Berlin.
It comes ahead of a crunch meeting of eurozone leaders to resolve the Greek debt crisis and prevent further contagion to other eurozone economies.
Details of the deal have not yet been released.
But there are indications that a new tax on Europe's banks to help fund any new aid packages may not be part of the deal.
Arriving at the summit, the head of the Eurogroup of finance ministers, Jean-Claude Juncker, played down the bank tax idea.
"I do not think there will be an agreement on that subject," he said.
Germany had previously insisted that private lenders to Greece should be forced to take losses as part of any further rescue deal for Athens.
But this had been opposed by France and the European Central Bank, which fear it could spark a Europe-wide banking crisis, push Spain and possibly Italy into trouble, and even jeopardise the solvency of the ECB itself.
Meanwhile, new figures from Markit's PMI survey show that the eurozone's private sector grew at its weakest pace in almost two years in July, recording a score of 50.8, down from 53.3 in June. Any score above 50 indicates growth.
"The eurozone recovery lost almost all of its momentum in July," said Markit's chief economist Chris Williamson.
Also on Thursday, Spain was forced to pay a higher rate of interest to borrow money from international investors. Madrid had to offer a yield of 5.9% on 10-year bonds, up from 5.4% at a similar auction last month, in order to raise 1.8bn euros ($2.6bn; £1.6bn).
http://www.bbc.co.uk/news/business-14229717
Note: 21 July 2011 Last updated at 10:05 GMT
A statement by the French president's office said agreement had been reached after seven hours of talks in Berlin.
It comes ahead of a crunch meeting of eurozone leaders to resolve the Greek debt crisis and prevent further contagion to other eurozone economies.
Details of the deal have not yet been released.
But there are indications that a new tax on Europe's banks to help fund any new aid packages may not be part of the deal.
Arriving at the summit, the head of the Eurogroup of finance ministers, Jean-Claude Juncker, played down the bank tax idea.
"I do not think there will be an agreement on that subject," he said.
Germany had previously insisted that private lenders to Greece should be forced to take losses as part of any further rescue deal for Athens.
But this had been opposed by France and the European Central Bank, which fear it could spark a Europe-wide banking crisis, push Spain and possibly Italy into trouble, and even jeopardise the solvency of the ECB itself.
Meanwhile, new figures from Markit's PMI survey show that the eurozone's private sector grew at its weakest pace in almost two years in July, recording a score of 50.8, down from 53.3 in June. Any score above 50 indicates growth.
"The eurozone recovery lost almost all of its momentum in July," said Markit's chief economist Chris Williamson.
Also on Thursday, Spain was forced to pay a higher rate of interest to borrow money from international investors. Madrid had to offer a yield of 5.9% on 10-year bonds, up from 5.4% at a similar auction last month, in order to raise 1.8bn euros ($2.6bn; £1.6bn).
http://www.bbc.co.uk/news/business-14229717
Note: 21 July 2011 Last updated at 10:05 GMT