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IPFS News Link • Economy - International

EU pledge on Greece fails to calm fears (+Video)

• Financial Times

The leaders of the 27-nation bloc promised “determined and co-ordinated action if needed to safeguard stability” of the eurozone, which has been shaken by turmoil in bond markets amid fears that Greece’s debt problems could spread.

The accord amounted to an implicit assurance to help Athens if it had problems in refinancing debt in April and May.

But the lack of a detailed bail-out plan underwhelmed investors in financial markets. While global stocks and bonds made modest gains, the euro fell 0.9 per cent against the dollar.

Herman van Rompuy, the EU’s permanent president, described the deal as a “political statement” saying leaders had not come up with a detailed rescue package because Greece had not asked for assistance.

Mr Sarkozy said: “We have committed to a show of solidarity, transparency and discipline.”

The EU endorsed Greece’s plans to cut its budget deficit by 4 percentage points of gross domestic product this year.