EU Struggles to Tame Crisis Amid Contagion
By James G. Neuger - Aug 5, 2011 4:11 AM ET
European leaders hunted for solutions to the rampaging debt crisis after the resumption of the European Central Bank’s bond-buying program failed to prop up securities in Italy and Spain.
As global stock markets sank for an eighth day, the European Commission called for another reinforcement of the European Financial Stability Facility, the 440 billion-euro ($623 billion) rescue fund for distressed euro-area states.
“To be effective, the EFSF needs to be credible and respected by the markets,” European Union Economic and Monetary Commissioner Olli Rehn said on BBC Radio 4’s Today program.
Europe’s fractious government leaders were back in the spotlight after a divided ECB restarted its bond-purchase program yesterday following a four-month hiatus. The central bank refused to extend the purchases to Italy and Spain, the two countries at the center of the current turmoil.