ECB raises eurozone interest rates to 1.5%

The European Central Bank (ECB) has raised interest rates to 1.5% from 1.25% in an attempt to cool inflation in the 17-nation eurozone.

ECB president Jean-Claude Trichet said that inflation, now 2.7%, was likely to remain "clearly" above the ECB's 2% target over the coming months.

German Exports Increase More Than Forecast as Nation Weathers Euro Crisis

German exports increased more than economists forecast in May, adding to signs the sovereign debt crisis isn’t harming Europe’s largest economy.

Exports, adjusted for work days and seasonal changes, increased 4.3 percent from April, when they fell 5.6 percent, the Federal Statistics Office in Wiesbaden said today. Economists forecast a gain of 1.5 percent, according to the median of 12 estimates in a Bloomberg News survey. Imports rose 3.7 percent from the previous month.

Iceland's Euro Bid Hinges On Greek Crisis Outcome, Central Banker Says

AIX-EN-PROVENCE, France -(Dow Jones)- Policymakers in Reykjavik are closely watching the unfolding of the Greek debt crisis, for its outcome will be a key element of Iceland's decision to join the euro, the head of the country's central bank, Sedlabanki said, as he urged the currency bloc to improve its economic governance.

"The outcome of the Greek crisis will affect the attractiveness of being a member of the euro area," Mar Gudmundsson told Dow Jones Newswires in an interview here late Friday. "A monetary union needs much more economic integration, some elements of common economic and fiscal policy and a common financial stability framework. One needs to match an economic union with the monetary union for it to work," he added.

EURO GOVT-Bunds dip before ECB, Italy yields reflect crisis

LONDON , July 7 (Reuters) - German government bond yields were steady on Thursday, supported by fears the euro zone debt crisis was intensifying, with a solid Spanish bond sale doing little to relieve tension.

Two-year German yields were off lows hit in the previous session, with strategists saying a move to close to 1.54 percent looked overdone given the European Central Bank is poised to raise interest rates to 1.5 percent later in the day.

Euro Zone Status Quo 'Untenable': Economist

The current situation in the euro zone is "untenable" and policymakers will have to either pursue greater European economic integration or see countries exit the euro, George Magnus, Senior Economic Advisor, UBS told CNBC Tuesday.

"Every crisis takes us closer to the point where an existential decision has to be taken," Magnus said. "This sequential crisis that the euro zone has been through since the beginning of last year must be resolved."