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Greek Leaders Wrestle With Spending Cuts Demanded for Rescue

Greek Prime Minister Lucas Papademos struck a tentative deal with political parties on austerity measures demanded by international creditors as European leaders maintained pressure to complete terms for a 130 billion-euro ($171 billion) rescue package.

Chiefs of the three parties supporting Papademos’s interim government were due to meet with the premier at about midday to hammer out details after setting a framework for recapitalizing banks, ensuring the viability of pension funds and reducing wages and non-wage costs to boost competitiveness. They agreed in a five-hour meeting yesterday to make additional reductions this year equal to 1.5 percent of gross domestic product.