France and Germany to push ahead with imminent Treaty change

WSJ: IMF urges ECB to expand its balance sheet to tame crisis

Fears over the eurozone crisis reached Germany yesterday as an auction of ten-year Bunds managed to raise only €3.64bn out of a target of €6bn, with the remainder retained by the Bundesbank. The main reasons for the limited demand are seen to be the increasing uncertainty over the long term state of the eurozone, the very low yields offered on primary bund auctions and the unusual struct...

Speaking on his way to Australia, David Cameron said, “London is the centre of financial services in Europe. It's under constant attack through Brussels directives. It's an area of concern, it's a key national interest that we need to defend.” He added, “There are a lot of things the eurozone is doing together.

At Saturday’s G20 summit in Paris finance ministers reiterated their call for a decisive and comprehensive solution to the eurozone crisis, but differences still remain between France and Germany over the level of Greek debt write-downs and a bank recapitalisation.

Political parties in Slovakia have agreed to ratify the expansion of the eurozone’s bailout fund, the EFSF, by the end of the week after the initial vote was rejected on Tuesday and the collapse of the four-party coalition government. An election is now expected to be held on 10 March 2012.

The debate over the approval of the expanded powers of the EFSF, the eurozone’s bailout fund, raged on in Germany over the weekend with Klaus Regling, Head of the EFSF, claiming that “hysteria is sweeping Germany”. EurActiv reports that 23 MPs from the governing CDU party are planning to vote against the law approving the new EFSF powers and, although, this will not stop its pass...

Ahead of a meeting between German Chancellor Angela Merkel and French President Nicolas Sarkozy, members of both governments seemed to rule out Eurobonds as an immediate solution to the eurozone crisis, the FT reports. In an interview with Der Spiegel German Finance Minister Wolfgang Schäuble said, “I rule out eurobonds for as long as member states conduct their own financial policies a...

Spanish Prime Minister José Luis Rodríguez Zapatero announced on Friday that a Spanish general election will be held on 20 November. Zapatero had planned to serve out his full term until March 2012, but with the government looking like it may fail to garner enough parliamentary support to pass its next budget, he was forced to call an election.

Credit rating agency Moody’s downgraded Portuguese debt by four notches to junk status yesterday, suggesting that there is a “growing risk that Portugal will require a second [bailout]” and that this will include some form of “private sector creditor participation”.