Sarkozy, Merkel to discuss Greek referendum

French President Nicolas Sarkozy and German Chancellor Angela Merkel were to discuss Tuesday by telephone Greece's decision to hold a referendum on the eurozone deal to reduce Greek debt, the French presidency said.

Greek Prime Minister George Papandreou caused surprise on Monday by announcing he would hold a referendum on the deal, which saw private lenders agree to take a 50-per-cent haircut on their holdings of Greek debt and eurozone members agree a second 100-billion-euro (137-billion-dollar) rescue plan for Greece, among other measures, DPA reported.

Greece's referendum plans caused dismay in Europe and sent markets into a tailspin.

Merkel and Sarkozy led the negotiations on last week's deal.