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Markets steadily marched north, paying little mind to important chatter from EU leaders.But we saw a handful of important tidbits today, many of which we’ll likely hear about next week as officials prepare for this month’s summit on January 27:
That whole nonsense with the IMF.
- European Central Bank Governing Council member Ewald Nowotny said the bank is considering ways to overhaul or replace its bond buying program, the Securities Markets Programme. Nowotny didn’t explicitly rule out quantitative easing.
- The U.S. Treasury announced it has “no intention” of contributing more money to the IMF to bail out Europe after reports surfaced that IMF wants to raise the funding of the bailout fund by $500 billion to $1 trillion.. Sorry, guys.
- German Economy Minister Phillip Roesler said that Germany has lowered its growth expectations for 2012 from 1% to 0.7%. Even so, he said the country will avoid recession.
- Talks resumed in Greece between private sector bondholders and Greek, EU, and IMF officials about the details of a deal to extend the maturities and even change the coupon on existing holdings of Greek bonds. We hear conflicting reports about whether or not the two sides are actually close to a deal. According to FT, under consideration are plans for a bond coupon starting at about 3% and rising to 4.25% or 4.5% by maturity.
- Italian PM Mario Monti spoke in London today. In particular, MNI reported that Monti said he and EU leaders were making strides towards policies that would “put a cap” on rising bond bond spreads in the periphery (the wire’s wording). We found that intriguing.
- Hungarian President Viktor Orban said he’s willing to compromise with the EU and IMF in order to secure a fixed credit line, speaking at a news conference in Strasbourg, France today. That was positive news, a day after the EU threatened to file a lawsuit against the country for policies it alleges would compromise the Hungarian Central Bank’s independence. Doesn’t mean the two still aren’t playing a perilous game of chicken, however.