Headlines

A political row has erupted in Athens after the former head of a big Greek state bank admitted to transferring €8m of personal savings abroad to buy a London property months before his Agricultural Bank headed towards insolvency, the Financial Times reported. Theodoros Pantalakis, former chief executive of Greece’s Agricultural Bank (ATEbank), strongly denied any wrongdoing, telling Realnews, a Greek website, that he had declared the transaction to authorities in 2011 and had paid tax on the amount transferred.

Greece's latest fiscal and reform pledges may be enough to convince international lenders weary after years of broken promises to keep Athens hooked to a 130 billion euro lifeline, but the battle to implement it will be epic, Reuters reported. Few question the new coalition government's resolve but many doubt whether the cantankerous public sector can or will implement the measures or the Greek public, reeling from years of austerity, can take much more without putting up a fight.

Senior Spanish officials are holding out the possibility that the government might need to ask Europe for a financial bailout, but gave no indication that such a decision was imminent, The Wall Street Journal reported. Finance Minister Luis de Guindos said in an interview published Sunday that Spain is in no rush to request a European bailout and can afford to wait until more information regarding a possible European assistance program comes to light. "When we know the details [of the aid program], we'll have a more precise calendar," Mr. de Guindos was quoted as saying.

Italy needs moral support from Germany but not its cash, Prime Minister Mario Monti said in an interview published on Sunday as German conservatives renewed calls for Greece to leave the euro zone, Reuters reported. The Italian leader also told weekly magazine Der Spiegel that he was concerned about growing anti-euro, anti-German and anti-European Union sentiment in the parliament in Rome.

The Canadian economy churned out an impressive number of new jobs over the first half of the year, but is not likely to repeat the feat in the second half, The Globe and Mail reported. The odds of the unemployment rate falling much below its current 7.2 per cent over the next five months are looking increasingly dim, as economists trim their expectations for Canada’s economic growth to below 2 per cent for the rest of 2012. Signs of the sluggish economy are expected to crop up in Statistics Canada’s employment figures for July, set to be released Friday.

European Central Bank President Mario Draghi dashed hopes the central bank would take imminent action in troubled euro-zone debt markets, unleashing a global selloff, The Wall Street Journal reported. A week after promising to do "whatever it takes" to save the euro, Mr. Draghi, under pressure from Germany, softened his rhetoric. The ECB would only deploy the full force of its arsenal, he said, after the region's governments begin using their own rescue funds to stabilize the markets.

The three central bank meetings this week -- the Bank of England, the European Central Bank and the Federal Reserve -- made very good cases for additional stimulus measures, though they failed to specify what these would be, Bloomberg reported in a commentary. Equities and certain bonds that had surged on the basis of last week’s verbal assurances by central bankers and political leaders sold off. There was no panic given central bankers’ promises to do more in the future should additional action be needed. This is what the standard narrative has been.

An intensification of the eurozone crisis would cause a significant loss of economic output around the world, the International Monetary Fund has warned in its latest Spillover Report, the Financial Times reported. Despite the turmoil that has already engulfed the eurozone, most of the potential economic shock to the rest of the world has not yet hit, the IMF said. If a big shock did unfold, then it would cost the eurozone more than 5 per cent of economic output, the UK would suffer almost as badly, and the US could lose 2 per cent of output.

Greece's international creditors have called on Athens to provide more details on its €11.5 billion ($14.14 billion) austerity plan that is crucial to keeping the country's funding lines open, as Athens faced dwindling cash reserves, The Wall Street Journal reported. A visiting delegation of international representatives met Thursday with Finance Minister Yannis Stournaras and agreed to see him again on Sunday in an effort to reach a deal on the cuts needed to pay the next tranche from the country's second €173 billion bailout.

A light is shining at the end of the tunnel for Indian telecom tower company GTL Infrastructure. After a drawn-out restructuring process, GTL is close to finalizing a cashless exchange offer with holders of its US$228.3m foreign currency convertible bonds, Reuters reported on an International Financing Review story. Bondholders have approved a restructuring proposal tabled by GTL's advisers Houlihan Lokey and Avista Advisory, leaving a resolution likely before mid-September if the Reserve Bank of India approves it.