European politicians are already heading off to chateaux and caravans across the continent, but this may mean an even tougher challenge when they return to their desks in September.
Markets have focused on the smallest action or promise of action from the European Central Bank (ECB - click here for an explanation) in recent weeks – the optimism following ECB President Mario Draghi’s promise to do “whatever it takes” to save the euro is a recent case in point - but European politicians are far from off the hook. With trading volumes thin, the slightest eyebrow raise seems to be able to move markets.
“Most of the challenges still rest in the political firmament, not the central banking firmament. The politicians still aren’t doing what they need to do, so the onus rests very heavily on Mr Draghi’s shoulders,” Alistair Newton, senior political analyst at Nomura, told CNBC’s “ Squawk Box Europe ” Thursday.
“If Draghi doesn’t convince markets that he’s bought time for the politicians, Europe’s politicians will have to cancel their holiday plans and get back to the pumps in Brussels, because this situation could get very serious – on the level of the Russian rouble crisis.”
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