Economy, Greece Debt | featured news

The Greek government says its painful austerity drive is paying off, with the budget deficit reduced to 6.6 percent of annual output in 2012 from 9.4 percent a year earlier. A finance ministry statement Monday said that, not counting the cost of servicing Greece's debt mountain, the government posted a modest budget surplus of €434 million ($588 million) last year.

Finance ministry officials in Greece have calculated that the debt-stricken country's economy will recover faster and its debt be more sustainable if it is given two more years to reduce its budget deficit, a Greek newspaper reported on Saturday.

Starved of financing options, Greece will offer an unusually large amount of treasury bills next week so it can meet looming redemptions and fund its cash needs .

Decision day for the Greek debt crisis is drawing near, and insiders are predicting that if things go awry it could cost the world economy $1 trillion.

Greek PM George Papandreou says an agreement has been reached on the creation of an interim government that will secure the new debt deal.

Greece will miss a deficit target set just months ago in a massive bailout package, according to government draft budget figures released on Sunday, showing that drastic steps taken to avert bankruptcy may not be enough.

Stocks are tumbling as investors worry that Greece won't qualify for a new installment of emergency funds in time to avoid defaulting on its debt.

France is ready to do whatever it takes to rescue Greece, the government said, and urged the debt-laden euro-zone member to swiftly implement the July 21 plan to prevent bankruptcy.

After a series of positive announcement from Greek FinMin Venizelos, rumors that Moody's would downgrade French banks and Germany was preparing for a Greece to default send equities tanking, particularly French banks.

European leaders are holding an emergency summit on Greece's debt crisis, trying to prevent a meltdown for the euro and a global economic slump.