Germany’s Constitutional Court this morning ruled in favour of the Eurozone’s rescue plans.
Ruling that an injunction against the European Stability Mechanism (ESM) and fiscal compact was largely unfounded, the judges said that Germany cannot increase its financial exposure beyond €190bn to the bailout fund without parliament’s approval first.
It also said ESM decisions must be submitted to both houses of parliament for approval, rejecting a confidentiality clause in the treaty.
The ruling means the country can sign the €700bn European Stability Mechanism into law.
Jeremy Cook, chief economist at foreign exchange firm World First, said this morning: “While the immediate disaster has been averted this merely brings us back in line with the general trend of gradual, painstaking improvement in the Eurozone.
“In lockstep with the European Central Bank’s decision to go out and buy bonds these verdicts do have the ability to fix the Eurozone but only in time."