Merkel bluntly rejects euro bonds as crisis solution

GERMAN Chancellor Angela Merkel bluntly rejected eurozone bonds as a solution to the currency area’s sovereign debt crisis, saying “collectivising debts” would not solve the problem.

Meanwhile, the European Union’s top economic official said he expected international lenders to be able to recommend by the end of the month releasing a vital tranche of aid to Greece, warding off the threat of an imminent default.

While that may keep Greece afloat until it gets a second bailout package from the eurozone, the finance minister said the country would remain mired in recession through 2012, the fourth year in a row, a contraction that is only likely to fuel popular outrage at the austerity drive.