Euro Leaders Plan Talks to Support Greece

Europe’s leaders plan a week of intensive shuttle diplomacy to help defuse the continent’s debt crisis, as Der Spiegel magazine reported that the European Central Bank is considering a plan to put a cap on bond yields.

As the debt crisis continues to threaten the global economy, French President Francois Hollande and German Chancellor Angela Merkel will meet in Berlin on Aug. 23. Greek Prime Minister Antonis Samaras travels to the German capital the next day before going on to Paris on Aug. 25.

The talks come as the ECB fleshes out plans to curb the turmoil in European bond markets, a move that would give governments time to push through measures to revamp their economies. The ECB’s governing council may decide at its next meeting in early September to set yield limits on the debt of each country, German news magazine Der Spiegel reported yesterday, without saying where it got the information.

A cap “could be a major step to defuse tensions in the eurozone and buy time for the fiscal repair and pro-growth reforms to work,” said Holger Schmieding, chief economist at Berenberg Bank in London. An ECB official declined to comment on the Spiegel report.

A plan to set a target on bond yields would involve the ECB using its power to print money, Spiegel said. The central bank would publish the volume of purchases for each country, the magazine said. Bloomberg

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Dean Popplewell

Dean Popplewell

Vice-President of Market Analysis at MarketPulse
Dean Popplewell has nearly two decades of experience trading currencies and fixed income instruments. He has a deep understanding of market fundamentals and the impact of global events on capital markets. He is respected among professional traders for his skilled analysis and career history as global head of trading for firms such as Scotia Capital and BMO Nesbitt Burns. Since joining OANDA in 2006, Dean has played an instrumental role in driving awareness of the forex market as an emerging asset class for retail investors, as well as providing expert counsel to a number of internal teams on how to best serve clients and industry stakeholders.
Dean Popplewell
Dean Popplewell

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