German Chancellor Angela Merkel says she is "still convinced" that a Greek debt deal is possible.

She said she thought Greece could reach an agreement with its creditors - the EU, the International Monetary Fund and the European Central Bank.

Mrs Merkel also told the Bundestag that Germany was working hard to keep Greece in the euro, but said Athens had to follow through on reform commitments.

"I'm still convinced - where there's a will, there's a way," she said.

"If those in charge in Greece can muster the will, an agreement with the three institutions is still possible."

Earlier, Greek Finance Minister Yanis Varoufakis said the country had a "political and moral duty" to reach an agreement with creditors over its debt crisis, Finance Minister Yanis Varoufakis has said.

But he said Thursday's meeting of eurozone finance ministers was unlikely to bring an immediate solution.

In return for more funding, creditors want further reforms from Greece.

But the ruling Syriza party is resisting those demands and, with talks deadlocked, fears are growing that Greece may default on its debts.

The European Commission, the European Central Bank (ECB) and the International Monetary Fund (IMF) could extend fresh finance, but are insisting on reform and further austerity measures.

Mr Varoufakis, when asked if there could be an agreement at the meeting of eurozone finance ministers in Luxembourg on Thursday, said: "I do not believe so."

"Tomorrow we will set the scene for what we consider to be our political and moral duty, and that is to reach an agreement very, very quickly with our partners and the institutions," he said.

On Wednesday Greece's central bank warned that the country could be on a "painful course" to default and exit from both the eurozone and the EU.

(BBC)