US Treasury Secretary Timothy Geithner has told euro zone ministers at a meeting in Poland that they should end loose talk about a euro zone break-up.
He was speaking after discussing with ministers the possibility of leveraging the euro zone's bail-out fund to give it more clout to tackle the region's debt problems. Geithner said Europe would not see similar global financial co-ordination as there was in 2009, but that the US would do what it could to help.
"What is very damaging from the outside is not the divisiveness about the broader debate, about strategy, but about the ongoing conflict between governments and the central bank, and you need both to work together to do what is essential to the resolution of any crisis," he said.
Geithner said he had told euro zone finance ministers that they had the capacity to deal with the now nearly two-year-old crisis, but had to improve their co-ordination.
Earlier, a senior euro zone official said Geithner had urged ministers to look at leveraging the €440 billion EFSF, to make it more effective at calming the sovereign and banking liquidity problems.
Geithner provided no details but Jean-Claude Juncker, the chairman of the Eurogroup countries, said euro zone governments would push ahead with approving decisions taken on July 21 to resolve the crisis, which include making the EFSF more flexible.
Austria's finance minister Maria Fekter later told reporters, however, that there had been disagreement over whether Europe should commit more money to fight the crisis, adding that the US Treasury Secretary ruled out the introduction of a tax on financial transactions.
Mr Juncker said programmes in Ireland and Portugal, which have both been bailed out, were on track and that Greece's renewed commitment to its programme meant that a decision on its next €8 billion tranche of aid would be taken in October.
Juncker said Greek Finance Minister Evangelos Venizelos reiterated Greek promises to meet targets in terms of budget and economic reforms, and "therefore we welcomed the renewed firm commitment of the Greek authorities to fully and decisively implement" the changes.
Meanwhile, the White House said this afternoon that US President Barack Obama would discuss the situation in the euro zone next week with European leaders during a meeting of the United Nations General Assembly in New York.
