Thursday, 29 September 2011

German MPs Vote for New Powers to Tackle Euro Crisis

THE DAILY TELEGRAPH: Germany's parliament approved new powers for the eurozone crisis fund by a large majority, giving the euro a boost and triggering a rally in Greek bonds.

The vote before the Bundestag lower house on expanding the €440bn (£380bn) bailout fund was also seen as a crucial test of Chancellor Angela Merkel's authority amid fears of a major backbench rebellion.

Among the 611 deputies present, 523 approved the measure, 85 voted against it and three abstained.

However, political pressure on Ms Merkel eased slightly as her coalition party won the vote without needing to rely on the opposition.

If the bill had only got through due to the centre-left opposition, she could be seen domestically as a "lame duck Chancellor, Holger Schmieding, chief economist at Berenberg Bank told Bloomberg TV. This could have undermined her ability to push through more measures to combat the crisis and leave.

Traders and European partners had been on tenterhooks ahead of the vote as Germany, the eurozone's biggest economy and paymaster, became the eleventh country among the 17 using the euro to agree to boost the scope and size of the fund, called the EFSF. » | Telegraph Staff and agencies | Thursday, September 29, 2011