Europe, European Central Bank | featured news

European Central Bank policymaker Athanasios Orphanides called for euro zone leaders to abandon plans to make private sector investors help reduce Greece's debts, but his push showed no sign of gaining any traction in Europe's capitals on Friday.

Italian bond yields are expected to fall from recent record highs in an auction on Thursday in a sign the European Central Bank has managed to ease market pressure, at least for now, with its big injection of longer-term funds earlier this month.

Germany and France clashed on Wednesday over whether the ECB should take bolder steps to stem the euro zone debt crisis, with Chancellor Angela Merkel issuing one of her starkest warnings yet against fiddling with the central bank's strict inflation-fighting mandate.

Stocks rose on Thursday after the European Central Bank launched fresh liquidity measures to help banks weather the euro zone's debt crisis, easing one of the major concerns overhanging markets.

A top board member of the European Central Bank unexpectedly resigned on Friday in what analysts saw as further evidence of the deep divisions over how to resolve Europe’s growing debt crisis. The move immediately rattled European markets and the euro, which slipped to a six-month low against the dollar. The European Stoxx and German DAX indexes tumbled 3.5 percent.

Greece’s finance minister has called on the EU to implement “fully and immediately” an agreement reached last month overhauling the eurozone’s rescue fund and extending Greece a €109 billion ($157 billion) bailout. The finance ministry says Evangelos Venizelos wrote to senior officials, including European Central Bank President Jean-Claude Trichet, EU economic commissioner Olli Rehn and eurozone finance ministers. Excerpts of the letter were released Sunday.

The European Central Bank said on Thursday it opposed forcing private creditors to take part in debt relief for Greece, pushing back against Germany, which has demanded a bond swap to lengthen Greek debt maturities.