Dec. 7 - U.S. Treasury Secretary Timothy Geithner expresses confidence in German and France ahead of crucial EU summit, but markets react to downbeat German comments.
Saying goodbye, for now. U.S. Treasury Secretary Tim Geithner left the Elysee Palace in Paris after meeting with French President Nicolas Sarkozy. Earlier, he said he was confident in France and Germany's plan to tighten budget discipline across the euro zone. to be outlined at Friday's crucial EU summit. (SOUNDBITE) (English) UNITED STATES TREASURY SECRETARY TIMOTHY GEITHNER SAYING: "We have a very strong, productive relationship, a lot of confidence in what the President of France and the minister are doing, working with Germany to try to build a stronger Europe. As I said yesterday we are encouraged by the progress they're making." Neither Sarkozy nor German Chancellor Angela Merkel will leave Friday's summit until they reach a convincing deal, according to France's finance minister. But Germany doesn't necessarily share that optimism. European shares trimmed gains and the euro fell after a German official told reporters on condition of anonymity that Berlin is increasingly pessimistic about the chance of an agreement. But if the summit comes up with a clear way forward, markets will be boosted, according to Standard Life Investments Chief Investment Officer Rod Paris. (SOUNDBITE) (English) CHIEF INVESTMENT OFFICER, STANDARD LIFE INVESTMENTS, ROD PARIS, SAYING: "I think that if the market feels there is tangible road maps and milestones being declared, and commitment to those milestones, that is what will give confidence to the market." As France and Germany push for greater fiscal integration, Britain - which is part of the EU, but not the 17 member euro zone, will be closely watching developments and trying to balance its national interests - with wanting to see the crisis resolved. British Prime Minister David Cameron. (SOUNDBITE) (English) BRITISH PRIME MINISTER DAVID CAMERON SAYING: "It is freezing the British economy, just as it is freezing economies right across Europe. So, resolving this crisis is about jobs and growth and business and investment right here in the UK. At the same time, we must seek safeguards for Britain - that is the right thing to do." But if Britain - or other EU countries block proposed treaty changes at the summit, the 17 euro zone countries will still be able to proceed with their own agreement. Kirsty Basset, Reuters.