Officials in Berlin said on Sunday Germany is now more resilient to boosting the European rescue fund to prevent the spread of debt contagion across the euro region and calm down tensions in financial markets.

The announcement increase expectations that euro area finance ministers will reach a decision regarding the expansion of the fund when they meet this week in Copenhagen.

Yet, it seems that Germany is in favor of temporary increase in the firewall, in line with EU Commissioner Oli Rehn's proposal which suggested the continuation of the ESFS even after the beginning of the ESM by mid-2012 to have a combined power of 940 billion euros, taking into consideration bailouts to Greece, Portugal and Ireland worth 200 billion euros which makes a net of 740 billion euros.

The main advantage for Germany from Rehn's mid-range option is that it will not cause political frictions before elections since it would be only temporary and it will not need approval from the Bundestag in addition to convincing major economies to boost IMF sources up to $1 trillion.