Factbox: Euro zone faces critical 10 days

A broker reacts at a brokers' office in Madrid December 1, 2011. S

(Reuters) The euro zone is entering a critical 10-day phase that could go a long way to dictating its future, the currency bloc's economic and monetary affairs chief said on Wednesday.

Following is a breakdown of the key events up to and including a December 9 European Union summit that is increasingly seen by investors as possibly the last chance to avert a breakdown of the single currency area.

For a graphic on how markets have reacted to key European policy meetings this year, click: r.reuters.com/van64s

THURSDAY, DEC. 1

- French President Nicolas Sarkozy will make a speech presenting proposals for closer fiscal integration among euro zone members.

FRIDAY, DEC. 2

- Chancellor Angela Merkel is expected to make a speech outlining Germany's vision for fiscal integration, a day after Sarkozy did the same.

- Sarkozy will meet British Prime Minister David Cameron with the key issue being Britain's willingness, or lack of it, to allow a process of EU treaty change to forge closer euro zone integration in return for the chance to repatriate some powers to London. Treaty change requires unanimous support.

MONDAY DEC. 5

- New Italian Prime Minister Mario Monti is expected to set out his debt-cutting measures in Rome, having been told by Brussels that he would have to take extra measures beyond an austerity plan already adopted to meet its balanced budget promise in 2013.

TUESDAY, December 6

- The Greek parliament is expected to vote on its 2012 austerity budget, a crucial part of its bailout terms. Once passed, it will herald the return of the troika - comprising representatives of the European Commission, the European Central Bank and the IMF - to Athens the following week.

WEDNESDAY, DEC. 7

- Centre-right EU leaders meet in Marseille for two days. Merkel, Sarkozy and incoming Spanish premier Mariano Rajoy will be there on Thursday as will top EU officials Herman Van Rompuy and Jose Manuel Barroso. Rajoy, not due to be sworn in until later in December, may outline some of his economic plans.

- Germany will auction around five billion euros of five-year debt. Last week it suffered a near failure with the authorities having to pick up about 40 percent of the paper that investors would not buy.

THURSDAY, DEC. 8

- Last ECB policy meeting of the year. A Reuters poll of economists forecast a 60 percent chance of a rate cut to 1.0 percent and a big majority said they expect the central bank to announce new long-term liquidity tenders to help keep banks afloat. The poll gave a 40 percent chance of the ECB stepping up bond purchases with freshly printed money within six months, something it has opposed so far though it may eventually have to conclude that the biggest threat lies in recession, a credit crunch and the risk of deflation rather than inflation.

- EU leaders gather in the evening in Brussels for a working dinner prior to Friday's summit.

FRIDAY, DEC. 9

- EU leaders' summit in Brussels. The focus will be squarely on new rules to tighten fiscal integration. The question is whether that will be done via time-consuming treaty change which would need to be ratified by all 27 EU members or whether a shorter cut, involving the single currency group pressing ahead alone, will be pursued. The optimistic view is that embarking on that process will calm financial markets but that is indeed optimistic. Dramatic measures involving the ECB breaking its rules by radically increasing its bond-buying support are unlikely at this point but there will surely be discussions about a way to get the IMF more involved, probably with money paid over by euro zone central banks. Analysts say a summit that falls short could lead to a harsh market reaction that could force a rapid reappraisal by policymakers, some of whom have already identified January as a potential crunch point.

(Writing by Mike Peacock)