Today’s market twitch: Germany says no quick fix for European debt crisis
Germany said European Union leaders won’t provide the complete fix to the euro-area debt crisis that global policy-makers are pushing for at an Oct. 23 summit, Bloomberg reported.
German Chancellor Angela Merkel has made it clear that “dreams that are taking hold again now that with this package everything will be solved and everything will be over on (Oct. 23) won’t be able to be fulfilled,” Steffen Seibert, Merkel’s chief spokesman, said at a briefing in Berlin today. The search for an end to the crisis “surely extends well into next year,” he said.
Group of 20 finance ministers and central bankers concluded weekend talks in Paris endorsing parts of Europe’s emerging plan to avoid a Greek default, bolster banks and curb contagion. Providing a week to act, they set the Oct. 23 meeting of European leaders in Brussels as the deadline.
On the summit agenda is how any recapitalization of Europe’s banks “might be carried out in a coordinated way” and how to make the European Financial Stability Facility, the EU’s rescue fund for indebted states, as effective as possible, Seibert said. The leaders will also discuss aid for Greece and ways to tighten economic and financial policy, he said.
Seibert’s statement “moved the disappointment trade to this morning,” Carl Weinberg, founder and chief economist at High Frequency Economics, said today on Bloomberg Television.
The statement was being blamed for a drop in crude oil prices and equities on U.S. and world markets.