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Euro Leaders Turn Fund Into Bond ‘Firewall’ as Greek Rates Cut

European leaders widened the scope of the euro’s rescue fund, authorized it to buy government bonds and eased the terms of Greek bailout loans as they unexpectedly pushed through fresh measures to end the bloc’s debt crisis.

Under a pact struck at 1:30 a.m. in Brussels after eight hours of talks, the bailout facility will now be able to spend its full 440 billion-euro capacity ($611 billion) and to buy bonds directly from governments. In a blow to European Central Bank President Jean-Claude Trichet, it won’t be allowed to purchase debt in the open market or to finance debt buybacks.