Given the raft of gloomy economic data, it is hardly appropriate to be optimistic about the prospects for the sustainability of the monetary union in Europe. But in one key area some progress is being made. The root causes of the crisis have been identified and actions are being taken to address them. This week, on 12 September 2012, a little-known German constitutional court took a huge decision and cleared the country’s participation in a new bailout fund. About a week ago, the ECB reversed an earlier decision and announced that it would serve as a lender of last resort in government bond markets.

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