Bloomberg News

G-20 Unlikely to Make Headway on Europe, Official Says

June 13, 2012

The Group of 20 nations meeting in Mexico next week probably won’t announce significant progress on Europe’s debt crisis, a U.S. official said.

The summit in Los Cabos, Mexico, will give European leaders a chance to discuss economic concerns with heads of other major economies. European governments are more focused on building a consensus for a meeting of the 17-nation euro zone later in the month, according to the official, who briefed reporters on condition of anonymity.

Outside events, such as a market reaction to the results of Greek elections scheduled for June 17, may prompt European leaders to move up their timetable, the official said. European officials may also confront pressure for greater clarity on how they will approach goals such as a banking union.

Still, the official said the U.S. did not expect Europeans to announce major new steps during the meeting and might not disclose any additional details.

President Barack Obama will meet with the rest of the G-20 leaders June 18-19. Obama is likely to repeat the message he delivered at last month’s G-8 summit, that Europe needs to focus on growth and solid firewalls to keep the crisis contained, the official said.

Obama, who is up for re-election in November, has repeatedly warned that the debt crisis in Europe is putting a drag on the U.S. recovery. He said at a White House news conference last week that Europe’s leaders must take “decisive” action to stimulate growth while dealing with debt.

Concern that Europe’s sovereign-debt crisis is worsening have helped push yields on 10-year Treasuries to record lows as investors seek a haven. The yield on the 10-year note slid six basis points, or 0.06 percentage point, to 1.61 percent at 2:37 p.m. in New York, according to Bloomberg Bond Trader data. It reached a record low of 1.4387 percent in trading on June 1.

To contact the reporters on this story: Mike Dorning in Washington at mdorning@bloomberg.net; Julianna Goldman in Washington at jgoldman6@bloomberg.net

To contact the editor responsible for this story: Steven Komarow at skomarow1@bloomberg.net


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