EUROZONE : ECHOES OF THE CRISIS.

Record high for banks' deposits at ECB: Eurozone banks put 453.18 billion on deposit at the European Central Bank (ECB) on 3 and 4 January, breaking the facility's previous record, the ECB announced, on 4 January. Although these funds yield very low returns from the ECB (0.25%), these day-to-day deposits have beaten records in recent weeks - evidence of the severe dysfunction of the interbank loan market. The previous record had been hit on 27 to 28 December (452 billion). Thus, the liquidities market is currently a closed circuit: the ECB is loaning massively and generously to banks, as it did in December by allocating 489 billion over a period of three years for 1%, but credit institutions always prefer to place their surplus liquidities with the ECB rather than to loan to each other or to the real economy. The fact that banks are holding their liquidities back in this way also shows their lack of interest in eurozone sovereign bonds.

Merkel to meet Monti in Berlin on 11 January: German Chancellor Angela Merkel has invited her Italian counterpart, Mario Monti, for discussions, on 11 January, on the future of the eurozone, as announced, on 4 January, by a spokesperson of the German government. The spokesperson specified that the themes of the discussions would be "bilateral and international issues, the eurozone situation, as well as the economic development of Europe".

Greek debt: IIF wants quick end to negotiations: The Institute of International Finance (IIF) said, on 3 January, that it wanted negotiations with Greece over the erasure of part of its public debt to come to a conclusion quickly. "Progress was made in the last few days in discussions about a voluntary exchange of debt for Greece," the IIF - a banking lobby which represents Athens' private creditors - said in a statement. "It is essential that a voluntary agreement be reached in days to come on the basis of terms and parameters agreed in Brussels on 26 and 27 October," stressed the IIF. During a summit in Brussels, the IIF reached an agreement with eurozone heads of state and government to erase half of the debt held by the private sector - for a total close to 100 billion. But the press announced higher demands from Greece's international partners. The outcome of these negotiations will determine the future of eurozone countries and of the International Monetary Fund (IMF) with which Athens will then look to negotiate a new bailout plan, following the 110 billion rescue...