A moment of calm in the Eurozone

The markets have settled as the firehose of bad news on the Eurozone crisis finally slows to a trickle.

by Rebecca Burn-Callander
Last Updated: 19 Aug 2013

It seems that no news is good news when it comes to the current financial crisis. The cost of borrowing in Italy has finally reached a plateau and begun to subside. A vote on austerity measures is imminent and you could hear a pin drop on the markets as investors wait to hear the outcome. Greece is also on the verge of a breakthrough as its prime minister designate, Lucas Papademos, prepares to name a cabinet later today.

German and French stocks are buoyant. Although the spread on the yields between French and German bonds is now at its highest ever since the start of the euro. The FTSE has rebounded too, opening up 40 points, or 0.7% this morning. There have also been gains on Wall Street and in Asia, as traders take advantage of the short-term ceasefire in Eurozone financial warring.

‘Markets are still going to be taking much direction from the European debt saga, but the pace of change does seem to have genuinely reached a turning point,’ says Peter Stanhope, Institutional trader at IG Market.

We’re not out of the woods yet. The euro is still hovering above its one-month low but analysts believe the currency is still vulnerable. But let’s enjoy this small moment of calm after all the commotion in the past weeks.

Fancy catching up on the crisis so far? Here’s your Eurozone crib sheet:

Eurozone crisis enters Wonga.com territory

Dio Mio! Italian bonds break 7% barrier

Italy groans under weight of debt

Greek debt crisis: coming soon to a country near you?

G20 leaders finally admit Greece might leave the euro

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