Lawmakers in Berlin backed Germany’s contribution to the 85 billion-euro ($112 billion) bailout for Ireland as Finance Minister Wolfgang Schaeuble said that additional measures to calm financial markets are not needed.
The lower house of parliament’s Budget Committee approved the emergency-aid package at a meeting late yesterday, Otto Fricke, a committee member for Chancellor Angela Merkel’s Free Democratic Party coalition partner, said by phone. Germany’s share of the aid package is about 6.1 billion euros, Schaeuble has said. A full vote in the plenary chamber is not required.
Europe is in the throes of a sovereign debt crisis that spread from Greece to Ireland and threatens to engulf the entire euro-area. The market decline since the European Union bailout of Ireland was announced on Nov. 28 is overdone and doesn’t necessitate a reaction by policy makers, Schaeuble said in Paris late yesterday.
“The market’s nervousness over some countries is excessive,” Schaeuble said. “Governments shouldn’t always respond to market nervousness.”
Bonds, stocks and the euro rallied yesterday as markets interpreted a comment from European Central Bank President Jean- Claude Trichet as a signal policy makers may step up their response.
The German aid was passed with the support of the opposition Social Democrats and Greens, Fricke said. Only the post-Communist Left Party failed to back aid.
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