Euro-Area Ministers Agree on Bond Guarantees, EFSF Financing
This article is for subscribers only.
Euro-area finance ministers approved enhancements to their bailout fund while backing off setting a target for how much firepower they plan to muster to stem a growing debt crisis.
After a series of stop-gap accords failed to protect Italy and Spain from widening bond yield, the ministers met in Brussels under growing pressure from U.S. leaders and financial markets to find ways to boost the European Financial Stability Facility’s effectiveness. They agreed to create certificates that could guarantee up to 30 percent of new issues from troubled euro-area governments and to create investment vehicles that would boost the EFSF’s firepower to intervene in primary and secondary bond markets.