debtEuropean stocks and the euro rallied on Thursday, following fresh of her vacation German Chancellor Angela Merkel's comments concerning the ECB's role in the fight against the European debt crisis and the Greek bailout program.

According to Bloomberg, two German lawmakers told reporters on Thursday that German Chancellor Angela Merkel is considering softening Greek bailout conditions.

CDU's Klaus-Peter Willsch said in an interview that there is a strong opposition among members of Merkel's coalition government towards any concessions to Greece, so “the official line is to stay tough” but “at the same time, some are being sent forward to test the waters on how this tough line can be abandoned.”

Free Democratic Party member Frank Schaeffler remarked in a separate interview that the Chancellor will most probably try to reach a compromise with Greek PM Antonis Samaras, making the bailout program more flexible but at the same time as consistent with the initial terms as possible.

Angela Merkel will hold talks with Antonis Samaras in Berlin on August 24. She has also scheduled a meeting with French President Francois Hollande on August 23, while the latter will see Samaras on August 25.

In the opinion of Chris Walker from UBS: “The topic of discussion is quite clear. While some urgency in decision-making has probably been lost during the summer lull and promise of action from the ECB, the structural problems surrounding Greece are unlikely to go away any time soon and the next source of market tension probably lies with this.”

Merkel backs Draghi's calls for preserving the euro at all costs

Speaking at a press conference on Thursday night German Chancellor Angela Merkel, who is visiting Canada at the moment, expressed her support for ECB's moves to save the Eurozone. She backed President Mario Draghi's calls for doing “whatever it takes to preserve the euro,” and said that ECB's stance is completely in line with European leaders' vision.

"What he said is something we repeated time and again since the beginning of the Greek difficulties more than two years ago,” Merkel assured.

According to Danske, the German Chancellor also said that “ECB’s insistence on conditionality in return for help to lower borrowing costs in indebted countries matches Germany’s priorities to end the crisis in the euro region.” She urged EU countries to move toward a closer fiscal integration in the region and to grant more powers to the European Commission, allowing it to intervene in case a Member State misses its budget goals.

Merkel's words boosted sentiment in the markets as they reassured investors that European leaders are working closely together on preserving the euro.