EU ministers discuss standby plans for Greece

Ministers from the 16-country euro zone announced late on Monday they had agreed the "technical modalities" that would permit aid to be rapidly rolled out but gave no figures and few details of a plan likely to involve bilateral loans.

They reconvened on Tuesday with the other finance ministers from the 27-country European Union, and the German and Spanish ministers reiterated that Greece did not need help for now.

Swedish Finance Minister Anders Borg said things were looking up after Athens announced extra austerity measures to cut a bloated public deficit and tame a national debt that is bigger than Greece's entire gross domestic product.

"We have a situation which is much better than one month ago," said Borg, who said earlier this year Greece's statistical reporting on public finances was "basically fraudulent."

Initial financial market reaction was muted, with no dramatic change in the euro exchange rate or bond yields, both of which have been buffeted by fears about Greece's ability to honour its debts and what this would mean for the monetary union more broadly.

German Finance Minister Wolfgang Schaeuble, who left Brussels early, told the German parliament there was increasing cause for concern that speculators were targeting currencies and the competitiveness of all EU states must be strengthened.

Ministers did not say when a final decision on aid for Greece was likely. A German government spokesman said Berlin did not expect any decision to be taken at an EU summit next week.

Germany, Europe's biggest economy and the country that would be the linchpin of any support, is reluctant to bail out Greece and above all to rush into anything before Athens shows it is willing to take the painful steps needed to fix its finances.

GREECE COULD GET BILATERAL AID