No Official Word on Greek Aid Plan
The euro fell against most major currencies on concerns that the Greek bailout may face difficulties as euro zone nations ratify the $60 million Greek bailout package. The euro suffered its biggest decline this month after German Chancellor Angela Merkel said that she will not release funds until Greece shows a ‘sustainable’ plan to address the nation’s massive deficit. Brian Kim of UBS AG stated, “There are more political headlines back and forth out of Europe. There’s no official word on the aid for Greece, and that’s weighing on the euro.” Merkel said that Germany would make no decision on the aid package until the IMF works out budget cuts with the Athens government. Merkel told reporters in Berlin, “We need a positive development in Greece together with further savings measures,” Merkel told reporters. Germany will help if the appropriate conditions are met. Germany feels an enormous obligation towards the stability of the euro. “If Greece is ready accept tough measures, not just in one year but over several years, then we have a good chance to secure the stability of the euro for us all.”
EU Members Ready to Act on Aid Plan
After Merkel’s comments the euro fell 0.5% to $1.3316. EU Economic and Monetary Affairs Commissioner Olli Rehn said that aiding Greece is a matter of economic stability for the euro zone. He also said that EU countries are ready to act on the bailout agreement. Rehn stated, “All euro area members are doing what is needed to be ready on time. “And I am confident that all euro area member states and other actors involved including the ECB, IMF and commission will be ready on time according to this agreement which was reached in the European Council in March and then detailed in the eurogroup agreement. It is not only a matter of Greece, but of financial stability in Europe as a whole — and that is the reason why we are ready to secure financial stability … over the euro area.”
Portuguese Foreign Minister Addresses Concerns
Investors have been concerned that Greece’s crisis could spread to other EU members. Portuguese Foreign Minister Luis Amado said on Monday addressed those concerns and said that Portugal is doing taking every measure possible to avoid a similar debt crisis. He also said that financial market pressures are making it difficult for Portugal to address deficit problems. Amado stated, “Obviously, we are worried about the situation on the financial markets but as we have underlined many times, the Portuguese situation is not quite comparable with the Greek situation. We are not in such a critical situation as Greece. We didn’t cheat with our statistics. They are reliable for a long time, and our imbalances at the macro level are not so deep.”
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