Germany’s ratification of the European Central Bank’s sovereign debt-buying scheme sent risk assets soaring yesterday, with yields on Italian government debt dropping to the 5% mark, while their German 10-year equivalent spiked.

Wednesday's judicial approval allows the €500bn European Stability Mechanism bailout fund to draw on up to €190bn of German government cash to fund short-term government bond purchases, in an attempt to bring the borrowing costs of peripheral eurozone economies down to sustainable levels.