Top Greek officials pressed their case on Tuesday for curbs on speculative trading they blame for pushing the country into crisis, but the Obama administration reacted coolly, saying it was working on its own plans to make trading more transparent.

Greece's finance minister, George Papaconstantinou, urged backing for a ban on some trading activities, such as short selling by investors of securities they do not own, because he said it inflates debt costs for countries like Greece that already are struggling to cut deficits.

Greece is doing what it should be doing to clean up its own mess, Papaconstantinou told CNBC television. However, there's a broader problem here. It's a European problem, it has to do with the euro, and it has to do with speculation.

The finance minister's comments echoed remarks a day earlier by Greek Prime Minister George Papandreou who said speculators must be reined in before their risky activities push the global economy into a new downturn.

Papandreou and Papaconstantinou were set to meet U.S. President Barack Obama and Treasury Secretary Timothy Geithner later on Tuesday, part of a concentrated series of meetings and public appearances aimed at shoring up confidence in Greece's ability to get through its budget crisis.


An Obama administration official offered a measured response to Greece's proposals, noting the United States was already working on a broad overhaul of U.S. financial regulation.

The president's plan would require more transparent trading and central clearing for standardized derivatives, the official said.

The Obama administration offered a pat on the back for Greece's efforts so far. Greece enacted a series of stiff austerity measures, like cuts in civil service salaries, that have stirred unrest.

We commend them for the bold steps they've already taken and have confidence that their European partners will support them on this difficult road, the U.S. official said.

Papandreou visited Germany and France before traveling to Washington for a four-day visit that ends on Thursday.

German Chancellor Angela Merkel said on Tuesday there were positive signs that Greece was making progress, including its recent successful government bond issue.


In my assessment, Greece does not need any financial support, Merkel told journalists in Luxembourg. Greece has won some trust back through the steps taken by its government.

In Washington, the Greek finance minister visited the International Monetary Fund on Monday for informal talks, but there was no indication that he broached the topic of possible aid for Greece. Papandreou has suggested that requesting aid from the IMF was possible if nothing else worked.

An IMF representative said only that Papaconstantinou discussed the provision of technical assistance in support of the government's stabilization plan but gave no details.

The IMF has remained on the fringes of the Greek crisis, sensitive to calls by European leaders that they want to deal with Greece as a member of the euro zone.

In the interview with CNBC, Papaconstantinou said more regulation was needed on credit default swaps, insurance-like products used to protect against debt default. Hedge funds have been accused of aggravating the Greek debt crisis by using CDS to bet on a potential sovereign default, without owning the underlying bonds.

(There should be) more transparency, a ban on naked selling, for example, Papaconstantinou said.

There was some support for consideration of that idea from European Union Commission President Jose Manuel Barroso, who said the EU would examine banning the naked short-selling of sovereign debt.

Ahead of a meeting with Papandreou, U.S. House of Representatives Speaker Nancy Pelosi praised the Greek government's determination to take the bitter medicine to restore its budget health.

The Greek people can be assured the United States will stand with them at this critical time, she told reporters.

Papandreou on Monday urged Group of 20 rich nations to crack down on market speculators and said the action was necessary to ward off risks of another global financial crisis.

(Additional reporting by Lesley Wroughton, Caren Bohan and Jeff Mason in Washington and by John O'Donnell and Michele Sinner in Luxembourg; Writing by Glenn Somerville, Editing by Padraic Cassidy)