Geithner meets eurozone leaders: a step toward taming debt crisis?
In Europe, US Treasury Secretary Geithner backs the European Central Bank's pledge to do 'whatever it takes' to save the eurozone from a potential breakup and boost economic growth.
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The backdrop for the meetings was storm clouds – both literally, on Germany's North Sea island of Sylt, where Mr. Schaeuble is vacationing, and figuratively, in the form of a worrisome rise in interest rates in Italy and Spain.
Those are some of the largest nations within the European Monetary Union. The interest-rate jump signals worry about whether they can generate enough economic growth to cover their large and rising public debts.
Last week, Mr. Draghi said the European Central Bank (ECB) stands ready to do "whatever it takes" to save the eurozone from a potential breakup. Those were strong words, symbolic of how important it is for Europe's leaders to hold investor confidence.
Stock markets surged last Thursday on Draghi's remarks, as investors took his words as a signal that the ECB might announce plans to purchase bonds of eurozone nations, in a bid to dampen interest rates and fuel growth. Simultaneously, the US Federal Reserve has been edging toward a possible "QE3" program, using so-called quantitative easing to stimulate the tepid US economy.
The central banks both have policy meetings this week, with investors especially focused on the European meeting Thursday.