FX:Euro Zone IMF Plan Raises Risk For Germany, Bundesbank Warns
Dow Jones reported about half an hour ago on story in FT Deutschland.
BUBA apparently worried that plan to expand IMF’s role in fighting crisis could endanger Germany’s aid to the region.
Under international rules IMF must always be repaid first, and the fear is that the euro zone’s fund would only recoup part of its contribution if a government were to go broke. Germany is the biggest contributor to the crisis fund, to the tune of 211 bln euros.
The paper reports Buba chief Weidmann is also concerned that merely announcing a new IMF programm might panic investors and increase pressure for new measures.
EUR/USD sits at 1.3015 in unispired trade. Talk of limited sell stops through 1.3000.
