Greece inches closer to deal on aid

Greece hopes to clinch a deal with its lenders on Tuesday for continued aid funding, an official said, after it pledged to take on as much austerity as needed to avoid a default that could trigger deeper turmoil on already shaky global markets.

EU finance ministers expressed doubt over the weekend that Greece could meet its obligations and the International Monetary Fund warned Athens to implement agreed reforms or miss an 8 billion euro ($11 billion) aid tranche slated for October vital to keeping state finances afloat.

Greek Finance Minister Evangelos Venizelos said the country would do what was necessary to get the aid but would not allow itself to be a scapegoat for euro zone policymakers who had failed to deal with the region's debt woes.

He held a phone call with members of the so-called "troika" of IMF, European Union, and European Central Bank officials late on Monday.

A Greek finance ministry official indicated the two sides had come closer to an agreement but more details were needed from Athens.

"The climate was better than we expected," the official said, on condition of anonymity. "We are close to a deal and we hope to conclude tomorrow. The government will make an announcement most likely on Wednesday, after a cabinet meeting."

Earlier in the day, the IMF's representative in Greece, Bob Traa, made clear that patience among Greece's international lenders was running out.

"The ball is in the Greek court. Implementation is of the essence," Traa told an economic conference.

Asked if Greece will get the sixth aid tranche, Traa said: "That's what we are working on ... We are making progress but it would not be correct for me to speculate on this ... I don't have a crystal ball but we are working 24/7 to get it done."

His comments added to pressure for action on promised measures such as further cuts to state salaries and pensions, firing public servants and shutting inefficient state organisations.

IMF inspectors were due to return to Athens this month but decided on Monday's call instead after the euro zone finance ministers failed to get closer to a broader solution to the crisis shocking both the common currency and global markets.

That coincided with the dramatic cancellation of Prime Minister George Papandreou's trip to the United States on Saturday to deal with the issue, which prompted fresh talk of a possible default and snap elections.

Officials have strongly denied both, but the worries caused world stocks to snap a four-day rally and pushed the euro weaker until the finance ministry official's statement helped them to recover some of the losses.