The European Central Bank kept interest rates on hold on Thursday and altered its assessment of risks to the economic outlook as investors focus on the ECB possible role in helping Greece avoid default.
The majority of Germans feel the Euro currency bloc would be better off if debt-crippled Greece left it, a poll published in mass-selling newspaper Bild am Sonntag showed.
Greece faces an exit from Europe's common currency block unless it clinches a deal on a second 130 billion Euro bailout with its international lenders, a government spokesman said on Tuesday.
Greece's creditors failed to persuade the leader of the main conservative party to drop his refusal to sign a pledge that he will back austerity measures under a bailout deal aimed at saving the country from financial ruin.
Greece's new government took a first step on Friday towards meeting terms of an international bailout needed to avoid bankruptcy, submitting a budget bill that foresees no new austerity measures next year as long as reforms are enacted.
Greece and private bondholders begun working on a deal to halve its public debt, a key pillar of a bailout plan to save the country from bankruptcy and ejection from the euro zone, sources said.
Greek Prime Minister Lucas Papademos said on Monday the policies tied to Athens' international bailout had worsened a recession and pushed unemployment higher, but the problem could be mitigated with reforms.
Greece named banker Lucas Papademos as head of a new crisis government on Thursday, ending the country's chaotic search for a leader to save it from default, bankruptcy and expulsion from the Euro zone.