Euro Strong While Centralized Banking Structure Plans Take Shape
The euro opened Friday morning at 1.3087, a strong start to the day after Thursday's finance ministers' meeting created renewed confidence in the crisis management effort in the region.
The meeting resulted in the ministers signing off on Greece's next installment of aid money, a move that was welcomed by the struggling country. Many view the revised bailout terms for Greece as a positive step away from the austerity driven approach the region's lawmakers have been taking for the past three years.
The bailout, which totals more than 49 billion euros, also came with pledges of support should the country's debt reduction plan meet any obstacles. It is widely believed that without further action from its peers, Greece will never recover from its financial struggle. Most expect a debt write off will be the next step creditor countries will take to help Greece lower its debt ratio.
However, even after European Central Bank President Christine Lagarde told reporters that the ministers had pledged to relieve some of the country's debt if needed, German Finance Minister Wolfgang Schaeuble carefully warned that a decision like that would need to get parliamentary approval in Berlin.
The meeting also gave the ministers a chance to discuss how to restructure the eurozone's banks into a single centralized banking system with the European Central Bank at the head.
According to Businessweek, in March of 2014 nearly 200 of the region's biggest banks will be overseen by the ECB within the new system. The plan has been approved by all of the finance ministers, but its implementation hasn't been finalized as lawmakers continue to debate and fine tune small issues.
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