Brussels – Relief at a bailout package for Greece drove global shares higher Friday after European leaders made sweeping changes to a rescue fund in an effort to seal larger economies off from the continent’s debt crisis.
News of the euro109 billion package of loans for Athens caused the yields, or interest rates, on the country’s bonds to fall sharply. The euro also continued its surge, moving to USD 1.4407. Private lenders will also be asked to contribute to the bailout and, as a result, the Fitch ratings agency said it would consider Greece in “restricted default”.
Speaking on Friday, German Chancellor Angela Merkel hailed the eurozone accord and said it was her country’s duty to support the single European currency. “It is our historical duty to support the euro,” Merkel said.
Greece’s Finance Minister Evangelos Venizelos said the deal would provide “great relief for the Greek economy”.
The eurozone agreement is a comprehensive package designed not only to resolve Greece’s debt crisis but to prevent contagion to other European economies, thereby shoring up the euro in the process.
(With reports from the BBC and Business Week)