Nov. 24 - German Chancellor Angela Merkel reiterates her opposition to joint eurobonds, despite growing market pressure and increasing calls for the European Central Bank to play a greater role in easing the crisis. Kirsty Basset reports.
As the leaders of Germany and France met for the first time with new Italian Prime Minister Mario Monti in Strasbourg, hopes were high that eurobonds - seen as a possible solution to Europe's debt crisis, would be on the agenda. Stephen Scharffetter is a trader at Baader Bank. (SOUNDBITE) (German) STEFAN SCHARFFETTER, TRADER AT BAADER BANK, SAYING: "I think that today's meeting will move us closer to Eurobonds, rather than distance us from them. It is on the agenda. We are hearing from all sides this morning that the German government is no longer ruling out Eurobonds so we are getting closer to Eurobonds. This will definitely be discussed this afternoon." But German Chancellor Angela Merkel again voiced her opposition to lumping Europe's debt together in a joint bond. (SOUNDBITE)(German) GERMAN CHANCELLOR ANGELA MERKEL SAYING: "When we take a first step towards fiscal union, for example by reinforcing the Stability and Growth Pact via automatic sanctions, it will be a step forward but it won't be grounds for me to change the opinion I expressed yesterday." France and Germany have held conflicting views over the role the ECB should be playing in stemming the crisis - but after the meeting, both countries agreed to stop arguing in public - with all three leaders backing the central bank's independence. It comes a day after a debt auction sparked fears that Germany is not immune to euro zone troubles - it failed to secure buyers for almost half its 6 billion euro debt up for sale. And some analysts predict things will have to get worse - before politicians take radical action. Jens Larsen is the Chief European Economist at RBC Capital Markets. (SOUNDBITE)(English) CHIEF EUROPEAN ECONOMIST - RBC CAPITAL MARKETS, JENS LARSEN SAYING: "I think frankly what they've demonstrated is they have an enormous willingness to wait and I fear that we'll have to see further intensification before we get a full response to this." The three leaders said they would try and agree on tougher budget discipline before an EU summit on December 9. Kirsty Basset, Reuters.