BERLIN (MNI) - Finnish Finance Minister Jyrki Katainen on Thursday praised the EU financial rescue package, but cautioned that the real economic problems of the Eurozone still persist.

"We have managed to buy some time," Katainen said at a conference on financial market regulation here. But "the real economic problems are still there."

The minister called the rescue packages "really creative." The fact that an agreement on these measures was reached has shown "that there is some political leadership in this continent."

BRUSSELS (MNI) - The European Union needs to address the problem of abusive short-selling but actions would be more effective if coordinated at the European level, the European Commission said on Thursday.

Germany late Tuesday announced a ban on some short-selling of Eurozone government debt and shares of major German financial companies, which pressured the euro and sent stock markets across Europe tumbling.

LONDON, May 20 (MNI) - Euro-dollar's recovery, from Wednesday's lows of $1.2143, extended above the New York high of $1.2400 to $1.2440 in early European dealing, with rate then moving into a consolidation mode through the balance of the morning, mainly holding back on a $1.23 handle.

Market currently seen in balance with some still waiting to be convinced that the recovery can extend.

LONDON, May 20 (MNI) - Cable consolidated its extended recovery gains through European morning trade Thursday, the rate struggling to hold gains above $1.4400, despite the release of firmer-than-expected retail sales data, though it was well buoyed above $1.4300.

BERLIN (MNI) - Bank of England Monetary Policy Council member Adam Posen said Thursday the structure of the British banking system is hampering the economic recovery of the country.

"In the UK we have too few banks, they're too large and this is interfering with the UK's recovery as well as being a destabilising factor," Posen said at a conference on financial market regulation here.

An overly concentrated banking system is one that is unstable, Posen reckoned: "It is good to have diversity."

BERLIN (MNI) - German Finance Minister Wolfgang Schaeuble said Thursday that the Greek crisis has shown the urgent need for financial market reforms.

"There exists an enormous need for action," Schaeuble said at a conference on financial market regulation here.

The minister said some financial instruments needed a "critical assessment." Instruments like credit default swaps or short selling "can massively increase economic volatility" also by inciting herd behaviour, he said.

SINGAPORE, May 20 (MNI) - The U.S. dollar reversed part of its morning gains in late Asian trade Thursday as the euro caught a bid tone and recovered through its early highs, triggering a scramble to cover short positions.

The euro had staged a decent rebound last night, climbing back to $1.2424 against the dollar, and recovering from its four-year low of $1.2134, traded on Wednesday.

BERLIN (MNI) - German tax revenue improved markedly in April but was distorted to the upside by significantly lower transfers to the EU, the Finance Ministry said in its latest monthly report released Thursday.

Federal tax revenue in April rose a strong 8.5% y/y after contracting 0.2% y/y in March. In the first four months of the year, federal tax revenue is down 3.4% y/y. For the full year of 2010, the government's tax estimate commission forecast earlier this month a decline of 5.1%.