Wed, 01 Dec 2010 22:20:00 +0100

US may extend its hand to EU stability fund

FXstreet.com – A rumored US commitment to support the EU rescue fund through additional unilateral contributions via the International Monetary Fund is what was making most of the headlines in the US session on Wednesday.
Reuters reported that the United States was ready to help the Euro-zone through an extra commitment of money. Despite it would be premature to make any judgments, Euro was already boosted on the news. According to Reuters, US officials are speculating on that, yet the ball is now in European court.
It is thought that the additional commitment of funds would be destined to enlarge the European Financial Stability Facility. The IMF has already vowed to economically support the European aid platform with almost $330 billion

US intends to prevent a double dip recession from happening, thus the strengthening of ties for collateral support to the EU fund mechanism seems about to turn into a harsh reality. The move, if confirmed, denotes the great US dependence on the finances of its largest ally in order to guarantee its own survivability.

Any fall down in Europe will cause devastating consequences in the Western hemisphere. According to data provided by the IMF, EU GDP in 2009 was the largest in the world, therefore, is simply not viable to contemplate a EU meltdown.

The possible ramifications of a European collapse would be too a burden too heavy to bear, even for the Unstated States. For these reasons, a visit to Europe this week by a US Treasury envoy has been scheduled; they will visit several European countries, with the intention of holding talks on the debt crisis.