Market participants are sceptical about the European Central Bank’s ability to support peripheral government debt without destabilising bond markets further, with the German news paper Spiegel suggesting over the weekend that the ECB could commit to unlimited purchases to keep yields below a defined level.

The question of whether the intended beneficiaries will accept the conditions attached to aid from the EU and ECB remains moot. These are not yet clear, but ECB president Mario Draghi has said that assistance would only be provided to the European periphery should the countries concerned sign a memorandum of understanding on fiscal reform.