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When its banking system collapsed in 2008, Iceland applied quickly to join the European Union, thinking it could guarantee a safe future. But since then, the eurozone has gone into meltdown, and the Icelandic economy has recovered. Now opinions have changed.

Senior euro-zone finance officials, moving ahead on a plan to create a single overarching bank supervisor for all the countries in the 17-nation currency bloc, are settling on a framework that would create a new agency reporting to the European Central Bank to police the largest banks in the currency union, people involved in the discussions said.

IMF Managing Director Christine Lagarde (R) speaks at a conference after the release of IMF's annual report on the U.S. economy in Washington, July 3, 2012.

As fears grow in Greece that the country may be forced to leave the eurozone, those with savings are looking for a safe haven. Meanwhile foreign buyers are moving to snap up Greek bargains as house prices take a tumble. Henry Ridgwell reports from London.

Socialist leader Evangelos Venizelos, a partner in the fledgling coalition government, said the meeting of the continent's finance ministers on Thursday in Luxembourg "will be the first big battle" on revising the $168 billion bailout Greece secured earlier this year. Venizelos said Wednesday that Greece will seek terms allowing the debt-ridden country, now in a fifth year of recession, to "move to positive growth" and cut its high unemployment rate.

The European Parliament Committee on Foreign Affairs, at its regular meeting today, will discuss the situation in Ukraine and the prospects of concluding the Association Agreement with the EU.

Greek voters broke months of political stalemate by narrowly endorsing pro-bailout forces in a momentous election, easing fears of an imminent rupture with the euro zone—for the moment.

German Chancellor Angela Merkel says Germany has the political will to ensure the stability of the eurozone. The German leader spoke alongside British Prime Minister David Cameron, who pressed for “urgent action” on the debt crisis.

The euro zone avoided recession with zero growth in the first quarter, but it seems to have run out of luck. Recent data out of the single currency bloc has led economists to conclude with confidence that a recession is imminent and the European Central Bank may not act Wednesday.

Secretary of State Hillary Clinton says the United States needs a strong recovery in Europe to help right its own economy.