Jumat, 29 Juni 2012

Financial markets rebound after eurozone leaders outline plans to shore up single currency and banking system

Financial markets rebound after eurozone leaders outline plans to shore up single currency and banking system

By City Finance Reporter

PUBLISHED: 15:55 EST, 29 June 2012 | UPDATED: 15:55 EST, 29 June 2012

Financial markets rebounded strongly yesterday after eurozone leaders outlined plans to shore up the crumbling single currency and its troubled banking system.

The euro jumped nearly 2 per cent against the US dollar towards $1.27, reversing four days of decline, and shares around the world soared.

The FTSE 100 index was up 1.4 per cent in London while the Frankfurt stock market rose 4.3 per cent, Paris 4.8 per cent, Madrid 5.7 per cent and Milan 6.6 per cent.

The euro symbol outside the headquarters of the European Central Bank in Frankfurt

Bouncing back: The euro jumped nearly 2 per cent against the US dollar towards $1.27, reversing four days of decline

Borrowing costs in Spain and Italy fell, leaving them well below the 7 per cent danger zone that triggered bailouts in Greece, Ireland and Portugal.

It came after eurozone leaders paved the way for the region’s rescue fund to inject aid directly into troubled banks without adding to government debt, and intervene in bond markets to prop up debt-riddled countries such as Spain.

After 14 hours of talks in Brussels at the 19th summit since the crisis erupted, the leaders also took a crucial step towards banking union with the creation of a single supervisor for eurozone lenders.

But experts warned that the rally will be short-lived.

New York economist Nouriel Roubini, who predicted the financial crisis, said: ‘The EU agreement is much less than needed. Markets are delusional in cheering this half-baked agreement that has little detail in it.’

Diposting oleh di

Tidak ada komentar:

Posting Komentar

Langganan: Posting Komentar (Atom)