Schauble tones down criticism

German Finance Minister Wolfgang Schauble Sunday appeared to back away from earlier comments on Greece that drew an angry response from President Karolos Papoulias, as signs grew of a rift in Berlin over how to tackle the Greek debt crisis.

?I do not know any Mr Schauble who would do such a thing,? the German official said after Papoulias last week accused him of insulting his country. ?Perhaps the Greek president misheard,? he said, adding that officials in the euro area were all working hard to consolidate the single currency ?and in particular to stablize Greece.?

Greece?s promises over austerity measures can no longer be taken seriously because Greeks have broken them too many times, Schauble said last week, describing the economy as a ?bottomless pit.? In what was seen as a clear sign of outside intervention, he also suggested Greece postpone a national election, pencilled in for April, as a condition for a second bailout loan.

Meanwhile, reports over the weekend suggested Schauble was distancing himself from Chancellor Angela Merkel?s official policy on Greece, favoring a strategy of allowing a Greek default. There were mixed signals with regard to whether he believes Greece should stay in the eurozone.