After reports surfaced that German Chancellor Angela Merkel was set to allow the use of the EFSF and its successor, the ESM to buy the bonds of troubled EU states, a spokesman for the European Commission responded today by saying that Eurozone finance ministers are not planning to discuss the idea. Moreover, Angela Merkel stated that the idea was "pure theoretical discussion" today at the G20 summit
Despite the cold water thrown over the notion of using European bailout funds to buy the bonds of troubled EU states, the idea seems to be gaining traction. Benoît Cœuré, a top European Central Bank policymaker who oversees financial market operations, has publicly stated he supports the idea, while Italian PM Mario Monti also raised the possibility of using the EFSF to buy bonds.
Meanwhile, in Greece, a coalition government has been set up and will be finalized today with New Democracy leader Antonis Samaras sworn in as Greek Prime Minister.