Euro Nations Renew Talk of IMF Role

Europe’s effort to expand its bailout fund is falling short, forcing euro-area finance ministers to consider greater roles for the International Monetary Fund and the European Central Bank to insulate Spain and Italy from the debt crisis.

A plan hammered out last month to expand the European Financial Stability Facility’s firepower to 1 trillion euros ($1.3 trillion) with leveraging will be “very difficult to reach,” Luxembourg Finance Minister Luc Frieden told reporters today before euro-area finance chiefs met in Brussels.

With prodding from the U.S. after a series of stop-gap accords failed to protect Italy and Spain from market turmoil, the ministers started talks on channeling ECB loans to cash- strapped euro nations through the IMF, aiming to bring the central bank on to the front lines without violating its ban on direct lending to governments.

Read Full Article from Bloomberg

- Posted: 2011-11-29 14:17:12

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