Friday, June 22, 2012

Eurozone Leaders In Rome For Mini-Summit

The leaders of Germany, France, Spain and Italy are meeting in Rome at a mini-summit that could expose major differences over how to deal with the single currency crisis.

German chancellor Angela Merkel was ambushed at the G20 meeting in Mexico by world leaders who feel her insistence on austerity in cash-strapped countries and refusal to unlock the wealth of their richer neighbours is making matters worse.

The general consensus among Francois Hollande of France, Mario Monti of Italy and Mariano Rajoy of Spain is that the financial punch of the two European bailout funds should be used directly to reduce borrowing costs in the eurozone.

Germany, together with the other so-called 'triple-A' countries: Finland, the Netherlands and Austria, believes that reducing borrowing costs would reward countries like Greece for allowing their finances to spin out of control.

Mr Monti, who is hosting today's meeting, believes billions of euro in the war chest could be used to purchase the debt of struggling countries in order to reduce the interest, or yield, those governments are being forced to pay. Read More