At the latest meeting in Mexico, the G20 has told the EU to do more to help itself before turning to the international community for support. It's not the first time it has heard this message, but it underlines the ongoing vulnerability of the rescue mechanisms in Europe, namely that the firewalls currently in place are insufficient to provide a sufficient backstop to Italy and also Spain. On paper, Europe can afford to do so, but in practice there are major political and institutional barriers. Germany remains most opposed, not surprisingly given it will have to stump up the most funds towards any increase. This is going to be a growing issue as we head into the next EU summit at the end of this week.
Also in today's Daily Forex Brief:
- Aussie leadership issue put to bed for now
- Not the best time for an oil crisis
- Fighting the south-north flow