European stock markets surged and the euro rose on comments by European Commission President Jose Manuel Barroso about a proposal for euro zone bonds aimed at tackling the region’s debt crisis.
The euro increased the most in a week against the dollar after Barroso said he is close to proposing options for euro bond sales, the Irish Times reports. European markets had declined after Moody’s downgraded French banks Societe Generale and Credit Agricole due to their exposure to Greece’s debt, but were lifted by the talk of euro bonds, Reuters says.
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Barroso this morning also called for closer political integration in the EU and a “new federalist movement” to confront the challenge of the debt crisis to the union.
"This is a fight for the jobs and prosperity of families in all our member states," he said, the Irish Times reports. "This is a fight for the economic and political future of Europe. This is a fight for what Europe represents in the world. This is a fight for European integration itself."
Barroso called the euro zone debt crisis "the most serious challenge of a generation,” the BBC reports.
He said he would urge the 17 euro zone nations to issue joint bonds that would allow them to borrow money collectively.
But while euro bonds have been backed by Italian Finance Minister Giulio Tremonti and investor George Soros, Germany has repeatedly opposed the idea, and a political battle may lie ahead, the BBC says.