The leaders of the European Union’s national governments will be hoping that last night’s agreement is enough to calm financial markets sufficiently. They would like a quiet Christmas uninterrupted by emergency meetings of either the European Council or the council of finance ministers, Ecofin. 

By stating their determination to do “whatever it takes” to safeguard the stability of the eurozone, they want to signal to financial markets that they have reserves of political will and treasure to stave off contagion in the eurozone. 

The first day of the summit produced little that is new in terms of substance compared to the agreement on the main features of the permanent crisis mechanism that was reached by eurozone finance ministers on 28 November.

But at least leaders managed to end the harmful divisions that emerged in the run-up to the summit. Less than two weeks ago, Jean-Claude Juncker, the president of the Eurogroup, was accusing Angela Merkel, Germany’s chancellor, of being “un-European” when she dismissed his call for common eurozone bonds. 

Merkel seems to have won the argument about eurobonds for now. But it is one of a number of difficult issues that EU leaders have handed over to finance ministers to resolve. 

Starting in January, finance ministers will have to settle tricky issues such as the size of the funds at the mechanism’s disposal. Didier Reynders, Belgium’s finance minister, has said it needs to have double the funds that are available under the two existing instruments, which are temporary. 

Ministers will also discuss possible uses for the mechanism’s funds. Options include using the mechanism to buy bonds of eurozone countries or to recapitalise ailing banks. 

Bond traders, already distracted by thoughts of winter snow, may be reassured that EU leaders have finally got a grip on the eurozone’s problems. But the difficult issues that have been left for finance ministers to settle suggest that there will be plenty of scope for further division and uncertainty in the first part of 2011.

Click Here: cheap sydney roosters jersey