Mon Jan 17, 2011 1:54pm EST
* Euro zone finance ministers meet in Brussels
* Rescue fund changes to be discussed, but no final decision
* Dutch minister says euro zone must have full rescue fund
* ECB discloses bigger bond-buying to steady market
* Spain scraps bond auction in favour of a syndicated issue
(Updates with Spanish debt)
By Jan Strupczewski and Ilona Wissenbach
BRUSSELS, Jan 17 (Reuters) - Euro zone finance ministers
called on Monday for an increase in the effective lending
capacity of the currency bloc's rescue fund, but EU paymaster
Germany said there was no urgency and it would be March before a
firm plan was in place.
Growing realisation that a deal to widen the bailout fund
was not imminent caused the euro to retreat on Monday from a
one-month high reached after successful debt auctions by
Portugal and Spain last week.
Dutch Finance Minister Jan Kees de Jager said it was vital
that euro zone governments under pressure forge ahead with
structural economic reforms and deficit-cutting to make debt
levels sustainable.
It was also important that the full amount earmarked for
states shut out of credit markets be available if required, not
the smaller amount that can actually be tapped now because of
the need to put cash aside, he said.
"We have an emergency fund in place. We will look if it
needs an increase... so as to have 700 billion euros ($932
billion) available, instead of a lower amount," De Jager said on
arrival for the monthly meeting of the 17-nation Eurogroup.
A Reuters poll of bank analysts across Europe found most
expect euro zone policymakers eventually to increase the
firepower of the European Financial Stability Facility by 260
billion euros to 700 billion.
But German Finance Minister Wolfgang Schaeuble said that
with bond markets calmer, there was no rush to take action now
and work was being prepared for a late March EU summit.
"There will not be results today, the market developments in
the last week have, thank God, taken any urgency out of these
discussions," he told reporters.
Source: Reuters.Com
