Why the eurozone will survive the crisis

Hopes for additional accommodation measures from key central banks kept global equity markets buoyant for much of the third quarter despite a slowing world economy. Even though austerity backlash fuelled protests in Europe, there was increased optimism for improvement in the region’s sovereign debt crisis amid the European Central Bank’s (ECB) commitment to buy government bonds of troubled countries in an unrestricted capacity. This move drove borrowing costs of peripheral European countries lower and many European equity markets higher. However, Spain’s worsening recession and dis...