German Chancellor Angela Merkel and Luxembourg Prime Minister Jean-Claude Juncker called for urgent regulation of credit-default swaps to shore up the euro area and prevent a rerun of the Greek financial crisis.
Merkel, speaking to reporters in Luxembourg today before Greek Prime Minister George Papandreou meets President Barack Obama in Washington, said the European Union must take the lead in curbing the “very speculative elements” of derivatives trading, going beyond previous Group of 20 nations agreements. The U.S. must also be on board, she said.
“We’re of the opinion that a quick implementation of actions in the area of CDS has to happen,” Merkel said. Citing “ongoing speculation against euro-region countries,” she called for the “fastest possible” implementation of new rules. Europe must “do everything to avoid unhealthy speculation,” said Juncker, who heads the euro-area finance ministers group.
