EU aid fund to ‘strengthen and protect’ euro
Germany Chancellor Angela Merkel said on Monday that an emergency trillion dollar rescue package for crisis hit eurozone countries would serve to bolster the weakened euro currency.
She told reporters that the package would serve to strengthen and protect the common currency, only hours after the European Union announced an unprecedented intervention worth more than 750 billion euros backed by the International Monetary Fund and central banks worldwide.
Merkel said that they intended to protect the currency in an extraordinary situation. However, she also siad that the eurozone must do more to tackle its stability problem by pressing member states to balance their budgets. She told reporters that they must attack the problem at its root. In the process, budget consolidation in all member states will become extraordinarily important.
Merkel welcomed new austerity measures pledged by Spain amid fears that the perilous Greek debt crisis could spread throughout the 16 nation eurozone, saying they sent an important message to the markets.
She added that Germany, as the eurozone’s biggest economy, would also introduce budget cuts to get its own fiscal house in order.
After days of plummeting in value on world markets, the euro surged in Asian trade on Monday at news of the rescue package which leaders hope will represent a game changing financial war chest in the face of damaging economic instability.
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