EU: Greek bailout hopes rise amid ECB concession
Talks between Greece and international creditors over a second bailout stretched past yet another deadline, but appeared to be moving toward a conclusion Wednesday after the ECB reportedly agreed to exchange Greek government bonds at less than face value in an effort to further reduce the nation’s debt load. The ECB will exchange government bonds bought in the secondary market last year at a price below face value once debt-restructuring talks with private creditors are successfully concluded, according to unnamed sources. (Wall Street Journal)
Germany: Meister says Greece must prioritize paybacks after debt swap
Greece must prioritize interest payments and debt redemptions after a possible write-down of its private-sector debt, said Michael Meister, a lawmaker from Chancellor Angela Merkel’s Christian Democrats. A joint proposal by Merkel and French President Nicolas Sarkozy on 6 Feb for Greece to set up a separate account to ensure payments is a “sensible approach”, said Meister. (Bloomberg)
Germany: Exports slump as crisis saps euro-area growth
German exports fell four times more than economists forecast in December as the sovereign debt crisis damped growth across the euro region. Exports slumped 4.3% from November, when they rose 2.6%. Economists had earlier predicted a decline of 1%. (Bloomberg)
France: January business confidence stalled on recession concern
French business confidence held near its lowest level in more than 2 years in January on concern the country may have tipped into a recession as the European debt crisis sapped confidence and forced budget cuts. The Bank of France’s Business Sentiment Indicator for manufacturers was unchanged from 96 in December. The November reading of 95 is the lowest since Sept 2009. (Bloomberg)
US: Unemployment decline masks labor force drop
US’ unemployment rate’s unexpected drop to a three-year low has overshadowed a less-positive labor market development whereby fewer Americans are looking for work. Last week, Labor Department announced that the jobless rate fell to 8.3% in January while the share of working-age people in the labor force had declined to the lowest level in 29 years. (Bloomberg)
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