Prime Minister David Cameron nudged Germany on Friday to reconsider its opposition to the European Central Bank playing a key role in a euro zone bailout plan, saying it should take all necessary steps to defend the euro.
Asked whether he believed Germany would allow the ECB to act as lender of last resort if necessary, Cameron said: The question has always been one for the Germans.
There is a very strong sense in Germany that you shouldn't use the central bank in that way. I understand and respect that but, at the end of the day, if you want to protect and defend your euro, you have to take whatever necessary steps there are, he said in an interview with ITV News in Perth, Australia, where he is attending a Commonwealth summit.
French President Nicolas Sarkozy backed down earlier this week in the face of German opposition to his desire to use unlimited ECB funds to fight the crisis.
Sarkozy acknowledged that France's proposal to multiply the firepower of the euro zone's rescue fund by turning it into a bank and letting it borrow from the ECB would not fly for now because neither Germany nor the central bank accepted it.
According to British news reports earlier this week, Cameron, whose country is not in the euro zone, had also wanted Germany to accept that the ECB would have to play the key role in guaranteeing the rescue fund.
Euro zone leaders struck a last-minute deal on Thursday to contain the currency bloc's two-year-old debt crisis but are now under pressure to finalise the details of their plan to slash Greece's debt burden and strengthen their rescue fund.
We all hope that the deal ... and the further detail that needs to be added to that deal will be enough to stabilise the situation, but there are clearly extra bits of work that need to be done, extra bits of detail that need to be put in place to make sure that we can go ahead, Cameron said on Friday.
(Reporting by Mohammed Abbas in Perth; writing by Adrian Croft in London; editing by Stephen Nisbet)