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| Eurozone crisis live: Bundesbank blasts ECB ahead of EU summit | Eurozone crisis live: Bundesbank blasts ECB ahead of EU summit |
| (40 minutes later) | |
| 9.37am: Just in – a second question has been posed over whether Greece has triggered a credit event. | |
| You can see it here, on the ISDA website. | |
| More to come... | |
| 9.31am: Britain's manufacturing sector grew in February, but at a slightly slower rate than in January. | |
| Markit just reported that the UK PMI came in at 51.2 last month, down from 52 the previous month,. That's below forecasts, but still strong enough to suggest that the sector will post growth during this quarter. | |
| 9.12am: More gloom for Italy, where the unemployment rate has hit its highest level since at least 2004. | |
| Instat reported that the seasonally adjusted jobless rate, which tracks people taking unemployment benefit, rose to 9.2% in January (from 8.9% in December). | |
| That's someway below the eurozone average (which hit 10.4% in December - we get January's figures at 10am GMT). Youth unemployment, though, remained painfully high, with 31.1% of 15-24 year olds out of work | |
| Italy's other problem is the low percentage of people actually in work. The employment rate inched up to 57%, from 56.9% in December, someway below the eurozone average. | |
| 9.01am Greece's manufacturing output has slumped to a record low level, according to Eurozone data just released. | |
| Markit's monthly PMI data [a survey of purchasing managers] for Greece came in at 37.7 for February, down from 41 in January. That's the lowest level ever recorded for Greece since Markit began its survey 13 years ago, and another sign that Greece's economy is slumping. | |
| The overall figure for the eurozone came in at 49.0, just below the 50 mark that seperates expansion from contraction. So the wider eurozone manufacturing sector continues to shrink, but at a slower pace than in January. | |
| The picture was pretty bleak in Spain, where the manufacturing PMI came in at 45.0. That's the 10th month in a row where Spain's manufacturing sector has shrunk. | |
| Italy also contracted again, but at a slower rate. Its PMI of 47.8 is the highest since last September, but the seventh contraction in a row. | |
| 8.32am: Mario Monti, Italy's technocratic prime minister, has warned that reforming the Italian economy will take many years. | 8.32am: Mario Monti, Italy's technocratic prime minister, has warned that reforming the Italian economy will take many years. |
| Monti, who is aiming to erase Italy's deficit in 2013, said in a Bloomberg interview broadcast this morning that he can only begin the task of deregulating the economy and overhauling its welfare system. | Monti, who is aiming to erase Italy's deficit in 2013, said in a Bloomberg interview broadcast this morning that he can only begin the task of deregulating the economy and overhauling its welfare system. |
| The former EU commissioner, who is expected to only serve one term as PM, said: | The former EU commissioner, who is expected to only serve one term as PM, said: |
| We will not complete a generational change -- that is, a change which normally requires a generation -- in 12 or 15 months...But it's important to kick-start it. | We will not complete a generational change -- that is, a change which normally requires a generation -- in 12 or 15 months...But it's important to kick-start it. |
| Here's a clip of the interview: | Here's a clip of the interview: |
| Monti has repeatedly promised to liberalise the schlerotic Italian economy, just as soon as he'd implemented tough spending cuts. But, as our correspondent Tom Kington reports from Rome, Monti's much heralded liberalisation plan was looking like a damp squib this week after Italy's tough business lobbies fought hard to water down the measures: | Monti has repeatedly promised to liberalise the schlerotic Italian economy, just as soon as he'd implemented tough spending cuts. But, as our correspondent Tom Kington reports from Rome, Monti's much heralded liberalisation plan was looking like a damp squib this week after Italy's tough business lobbies fought hard to water down the measures: |
| The bill, which emerged from Senate commission hearings earlier this week and is due to be voted on in the Senate, reveals Italy's taxi drivers have got one over the prime minister who humbled Microsoft when he was the EU's competition commissioner. | The bill, which emerged from Senate commission hearings earlier this week and is due to be voted on in the Senate, reveals Italy's taxi drivers have got one over the prime minister who humbled Microsoft when he was the EU's competition commissioner. |
| Original plans to give the right to determine taxi fleet numbers in Italian cities to a national authority were killed off, meaning local mayors maintain that right and will be unlikely to risk taxi drivers' votes by upping numbers, which is bad news for anyone who has tried to call a cab in Rome on a rainy night. | Original plans to give the right to determine taxi fleet numbers in Italian cities to a national authority were killed off, meaning local mayors maintain that right and will be unlikely to risk taxi drivers' votes by upping numbers, which is bad news for anyone who has tried to call a cab in Rome on a rainy night. |
| Tom says that Maurizio Gasparri, a former minister in Silvio Berlusconi's government, was in the forefront of the fight to keep the cabbies happy. Monti has also faced an army of lobbyists representing other business groups who "prowled the corridors outside the Senate commission, buttonholing senators when they dared to go to the bathroom". | Tom says that Maurizio Gasparri, a former minister in Silvio Berlusconi's government, was in the forefront of the fight to keep the cabbies happy. Monti has also faced an army of lobbyists representing other business groups who "prowled the corridors outside the Senate commission, buttonholing senators when they dared to go to the bathroom". |
| The scene, said Corriere della Sera, was a part souk, part tube station. | The scene, said Corriere della Sera, was a part souk, part tube station. |
| Tom continues: | Tom continues: |
| Italian lawyers and architects have also been able to scotch plans hatched by the government to force them to give clients estimates for services. | Italian lawyers and architects have also been able to scotch plans hatched by the government to force them to give clients estimates for services. |
| One Italian think tank, the Bruno Leoni Institute, said, the watering down of the liberalisation package proves that Italy is "unreformable". | One Italian think tank, the Bruno Leoni Institute, said, the watering down of the liberalisation package proves that Italy is "unreformable". |
| 8.18am: Germany's patience with Mario Draghi may finally have snapped. | 8.18am: Germany's patience with Mario Draghi may finally have snapped. |
| The president of the Bundesbank, Jens Weidmann, has warned the European Central Bank president that yesterday's Long Term Refinancing Operation (in which €529bn was loaned to European banks on generous terms) poses significant dangers to the eurozone economy. In a letter to Draghi, Weidmann urged the ECB boss to return to safer monetary policies. | The president of the Bundesbank, Jens Weidmann, has warned the European Central Bank president that yesterday's Long Term Refinancing Operation (in which €529bn was loaned to European banks on generous terms) poses significant dangers to the eurozone economy. In a letter to Draghi, Weidmann urged the ECB boss to return to safer monetary policies. |
| The letter was revealed by Germany's Frankfurter Allgemeine Zeitung. It says that Weidmann warned that the ECB is risking its reputation, and was wrong to relax its collateral rules – which means banks can put up a wider range of assets in return for their loans. | The letter was revealed by Germany's Frankfurter Allgemeine Zeitung. It says that Weidmann warned that the ECB is risking its reputation, and was wrong to relax its collateral rules – which means banks can put up a wider range of assets in return for their loans. |
| Weidmann also warned that if banks are unable to repay these loans in three years time, the individual central banks who stand behind the ECB could not cover the losses. As Frankfurter Allgemeine Zeitung points out: | Weidmann also warned that if banks are unable to repay these loans in three years time, the individual central banks who stand behind the ECB could not cover the losses. As Frankfurter Allgemeine Zeitung points out: |
| The letter is evidence of the growing unrest in the Bundesbank. | The letter is evidence of the growing unrest in the Bundesbank. |
| The letter comes as the boss of Standard Chartered, Peter Sands, warned that central bankers are sowing the seeds of the next crisis by offering so much liquidity today. | The letter comes as the boss of Standard Chartered, Peter Sands, warned that central bankers are sowing the seeds of the next crisis by offering so much liquidity today. |
| As we report here: | As we report here: |
| Breaking ranks from his fellow bosses, Sands, whose bank is focused mainly in Asia, said: "Banks are still going to have to refinance their loans in three years time. It's not clear what the exit strategy is, nor is it possible to predict what the long-term consequences will be." | Breaking ranks from his fellow bosses, Sands, whose bank is focused mainly in Asia, said: "Banks are still going to have to refinance their loans in three years time. It's not clear what the exit strategy is, nor is it possible to predict what the long-term consequences will be." |
| He added that the crisis and the west's policy response had accelerated the shift in "power and dynamism" from the developed world to emerging markets. | He added that the crisis and the west's policy response had accelerated the shift in "power and dynamism" from the developed world to emerging markets. |
| 8.05am: Although the EU summit doesn't begin until this afternoon, we should hear from Angela Merkel shortly. There's also plenty of economic news this morning, and Ben Bernanke will be testifying to Congress again. | 8.05am: Although the EU summit doesn't begin until this afternoon, we should hear from Angela Merkel shortly. There's also plenty of economic news this morning, and Ben Bernanke will be testifying to Congress again. |
| Here's the agenda: | Here's the agenda: |
• Eurozone manufacturing PMI • UK manufacturing PMI data - 9.30am GMT • Eurozone unemployment data for January - 10am GMT • Eurogroup meets to discuss Greece - 1pm GMT • Ben Bernanke testifies to the Senate banking committee - from 3pm • EU summit begins in Brussels - from 4pm | • Angela Merkel addresses Bundestag on EU Summit agenda - from 8am GMT • Eurozone manufacturing PMI data - 9am GMT • UK manufacturing PMI data - 9.30am GMT • Eurozone unemployment data for January - 10am GMT • Eurogroup meets to discuss Greece - 1pm GMT • Ben Bernanke testifies to the Senate banking committee - from 3pm • EU summit begins in Brussels - from 4pm |
| 7.55am: Good morning, and welcome to our rolling coverage of the eurozone debt crisis. | 7.55am: Good morning, and welcome to our rolling coverage of the eurozone debt crisis. |
| Later today, EU leaders will convene in Brussels to discuss the European economy. The summit is being billed as a chance to focus on growth and employment – two areas where the EU is struggling. | Later today, EU leaders will convene in Brussels to discuss the European economy. The summit is being billed as a chance to focus on growth and employment – two areas where the EU is struggling. |
| Before the meeting, the eurogroup (finance ministers from across the eurozone) will discuss Greece again – and consider whether it has met the conditions for its second rescue plan. | Before the meeting, the eurogroup (finance ministers from across the eurozone) will discuss Greece again – and consider whether it has met the conditions for its second rescue plan. |
| Another Greek development today: the International Swaps and Derivatives Association (ISDA) which oversees the credit default swap, will consider this morning whether a credit event has occured in Greece. This could finally decide whether Greek credit default swaps are triggered – although we may not get an answer until Monday. | Another Greek development today: the International Swaps and Derivatives Association (ISDA) which oversees the credit default swap, will consider this morning whether a credit event has occured in Greece. This could finally decide whether Greek credit default swaps are triggered – although we may not get an answer until Monday. |
| There's also a backlash gathering pace following the €529bn of cheap loans made by the European Central Bank yesterday. | There's also a backlash gathering pace following the €529bn of cheap loans made by the European Central Bank yesterday. |