STANFORD, California (MNI) - A delayed withdrawal of European Central Bank measures used to boost lending during the financial crisis would distort market behaviour and lead to a misallocation of credit, European Central Bank President Jean-Claude Trichet said on Friday.

The ECB considers the current pace of withdrawal "appropriate," he added.

FRANKFURT (MNI) - The future of the European Union depends on the rescue of Greece, European Union's monetary affairs commissioner Olli Rehn said in an interview with German daily Sueddeutsche Zeitung to be released Saturday.

"If Greece collapses and the European Union does not prevent that, we will lose our international credibility seriously and in the long term," Rehn told the newspaper.

Greece's debt crisis has brought the EU to an inflection point that will show whether member countries are ready to move closer together politically, Rehn said.

FRANKFURT (MNI) - Germany's GDP is apt to grow by around 1.4% in 2010 and it will take until about 2012 for Germany to return to pre-crisis levels, Bundesbank Vice President Franz-Christoph Zeitler said Friday.

Zeitler also told an audience in the German town of Tutzing, according to a text provided in advance by the bank, that the situation in Greece should serve as a wakeup call for countries to make their budgets more resilient.

Monetary policy can help prevent the emergence of bubbles, Zeitler said.

BRUSSELS (MNI) - New rules to regulate the E2 trillion hedge funds and alternative investment industry are set to be thrashed out at a meeting of European Union finance ministers here Tuesday.

An agreement is likely, EU diplomats said, because the proposals will be decided by a qualified majority and no country has power of veto over the final decision. But there is likely to be a heated debate over the rules, which some countries say contravene the EU's single market principles.

BRUSSELS (MNI) - Eurozone finance ministers meeting here Monday will discuss a rescue package for Greece as well as a longer-term mechanism to ensure Eurozone stability, EU diplomats said Friday.

However, it remains unclear whether the finance ministers will talk publically about the back-up plan or merely stick to their line that Greece has not yet asked for help, the sources cautioned.

BERLIN (MNI) - The Eurozone must show solidarity with members that have run into financial difficulty due to no fault of their own, Eurogroup President Jean-Claude Juncker said in a television interview aired Friday on Germany's N24 television station.

However, he made clear that Greece did not fall into that category.

PARIS (MNI) - Adding its voice to the resurgence of Greek bailout reports, France's daily Le Monde reported Friday afternoon that Eurozone states are nearing agreement on a potential rescue package worth between E20 billion and E25 billion.

Le Monde said their objective was to seal a deal at the meeting of Eurogroup finance ministers in Brussels next Monday. It said that the support for Greece would only be implemented "in the case of need."

BRUSSELS (MNI) - The European Commission is in line with other European leaders - including German Chancellor Angela Merkel - on the need to mitigate the impact of trading in credit default swaps (CDS) on government bonds, a spokesperson said on Friday.

Earlier this week, European Commission President Jose Manuel Barroso said the EU's executive arm would issue legislative proposals "before the summer" to increase transparency and limit risks in the derivatives market.

He also said a "new 'ad hoc' reflection is needed on Credit Default Swaps regarding sovereign debt."