The euro hit a four-month high today against the US dollar after German lawmakers said the country can now approve Europe's rescue fund.
Rejecting a complaint from an MP that the rescue fund - known as the European Stability Mechanism (ESM) - was a violation of Germany's sovereignty, the country's Constitutional Court has now paved the way for Germany to act to support the eurozone.
The euro has been climbing for the last few weeks in anticipation of further support and after today's announcement it set a fresh four-month high of $1.29, before falling back slightly. It is currently trading at $1.2889.
Equity markets are also firmer after the news. The German DAX is up 0.7% at 7,362 points, while the French CAC 40 is ahead 0.6% at 3,558.
In the UK the FTSE 100 is also marginally higher, up 0.3%, at 5,809.8.
The ruling today means the €700bn rescue fund can be approved by Germany's parliament, but Germany has imposed some key conditions, including limiting its own liability to €190bn.
German politicians must also be kept informed of how the rescue fund is being spent.
While positive for the eurozone, the situation remains far from resolved, with the fundamental problem facing the currency bloc - namely how do less productive nations cope with a strong currency - still hanging over it.
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