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Dijsselbloem’s Comments on Cypriot Bailout Spook Markets

The chair of the Eurogroup meetings, Jeroen Dijsselbloem, spooked markets with comments that the last-minute bailout of Cyprus set a precedent for any future interventions. The so-called bail-in of individual savers has been met my disbelief of many, after the move that was supposed to help Cyprus, send shockwaves through Europe. The unprecedented move led many to quickly draw parallels between Cyprus and other EU countries (PIGS), though EU official’s continuously stated that Cyprus was an individual case. Dijsselbloem’s comments yesterday reignited fear within the markets that bail-ins could occur in other EU countries. Following his comments, EURUSD sold off aggressively from the US session throughout Asia into the European open, trading around 1.2850.

Headlines

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