Merkel says Germany will do what’s needed for euro

Germany will continue to do what is necessary to guarantee the stability of the euro, Chancellor Angela Merkel said in an interview with Stern magazine released on Wednesday ahead of publication on Thursday.

Merkel told the weekly magazine there would be "no return to the deutschmark mark" and said Germany was committed to the euro "and will continue to do what is necessary to guarantee a stable euro".

Merkel said she was in favour of improving coordination of euro zone nations.

"What's at stake is more common policies on taxes and social issues, on labour laws and wage developments in the public sector. We've got to coordinate…to dismantle the at times considerable discrepancies."

She added: "Now we face the question: do the 17 euro zone countries need to work more intensively with each other? I say 'yes' but not exclusively. What we agree should be open for everyone else that wants to take part."

Merkel also said she rejected the idea of the euro zone splitting into a northern zone and southern zones.

"That's not going to happen with me," she said. "Speaking for Germany, I say quite clearly no to that. And besides that the situation is also not as black-and-white as that."

Merkel said she took quite seriously people's concerns about monetary stability but added she was convinced "that we will be handle all that".