Topic: Angela Merkel

Four years of economic crisis and market turmoil that have sent German bund yields to record lows now have half of the top bond strategists and economists polled by Reuters fearing a Japan-style "Lost Decade".

Germany's manufacturing sector has been shrinking at the fastest rate in three years in May, renewing concerns about the stamina of Europe's largest economy, which likely propped up the euro zone in the first quarter but is beginning to show signs of strain.

Angela Merkel, the German chancellor, finds herself increasingly on the defensive over the bonds, which she opposes as a near-term remedy for the region’s financial woes, The NYT reports.

"He is not in a confrontational mindset. He didn't arrive brandishing a
Kalashnikov and saying 'you must accept euro bonds'," one aide said. "It's a
different approach."

The markets have been oversold amid intense pessimism and a relief rally will be on its way within the next month, David Murrin, chief investment officer at alternative investment firm Emergent Asset Management, told CNBC’s “Worldwide Exchange”.

If a deal is going to be struck that avoids a Greek exit from the euro zone and restores confidence in the currency bloc, it is going to have to be big and convincing to markets. As one UK politician put it last week, the German Chancellor needs to fire a “Big Bazooka” if she is to save the euro zone from its current crisis.

A record-breaking pay deal will give millions of German workers their biggest rise in wages in two decades, boost consumption in Europe's biggest economy and help towards adjusting the regional imbalances that have caused severe tensions within the euro zone, analysts said on Sunday.

The Institute of Directors has endorsed a radical proposal that recommends replacing part of the UK tax system with a single income tax rate of 30 percent and reducing the government’s share of the national economy to one-third, the Financial Times reports.

World leaders backed keeping Greece in the euro zone on Saturday and vowed to take all steps necessary to combat financial turmoil while revitalizing a global economy increasingly threatened by Europe's debt crisis.

David Cameron, Britain’s prime minister, will on Thursday warn that the single European currency could unravel in a way that “carries huge risks for everyone” unless the eurozone’s 17 members move rapidly towards full fiscal and political union.

The European Central Bank has reacted to uncertainty over Greece’s future in the eurozone by excluding four of the country’s banks from its regular liquidity providing operations.

German Chancellor Angela Merkel reiterated on Wednesday that Germany wants Greece to stay in the euro, but warned that the country must play by the rules and honor its commitments.

When Greece announced on Tuesday that it had made a €436 million bond payment to the hold-out investors who rejected the country's historic debt revamping deal in March, the decision came as no surprise, the New York Times reports.

German Chancellor Angela Merkel and newly-inaugurated French President Francois Hollande said they want Greece to stay in the euro zone, a show of unity at their first meeting.