Business, Finance & Economics

Germany approves expansion of euro bailout fund

German lawmakers voted Thursday overwhelmingly in favor of expanding the powers and scope of the eurozone's bailout fund, which is for heavily indebted nations. This will hopefully make European countries better able to react to the debt crisis.

By approving the expansion of powers, Germany helped avoid a new bout of "massive market turmoil," the Associated Press reports.

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The $600 billion fund will be able to buy government bonds and lend money to banks and governments, it states.

"The support of the Bundestag is an important step for stabilizing the eurozone," Michael Kemmer, head of Germany's Bank Federation, told the news agency dapd, AP reports. "With that, they have set a course that leads out of the debt crisis."

The New York Times reports that the vote is also a small political victory for German Chancellor Angela Merkel after a debate within her parliamentary bloc weakened her grip on power.

German Parliament voted 523 to 85 in favor of the fund with three legislators abstaining.