A welcome step but not a solution

The deal agreed between the 17 leaders of the eurozone in Brussels during the early hours of yesterday is welcome, even though its specifics have yet to be agreed.

The arrangement should help to stabilise the bond market.

They also agreed to establish a single supervisory body for eurozone banks before the end of 2012. This could be a major step in setting up a European banking union that should be better able to avert the chaos that was feared in recent weeks.