October 24, 2011
The eurozone government bond markets have been turned upside down since the financial crisis first erupted in August 2007.
And they could suffer even more upheavals, as bankers press policymakers to come up with what could prove to be the key to the survival of the eurozone: common bonds.
Peter Schaffrik, head of European rates strategy at RBC Capital Markets, says: “The whole structure of the eurozone government bond markets has changed, but there may need to be more radical measures to end this crisis. European common bonds are a possible answer.”
Although Mr Schaffrik thinks it may take time to convince Germany and other northern eurozone members that common bonds could work, there is a growing view among many bankers that it may be the only way of allowing some countries to access the markets.
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