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Cyprus bailout sets 'profound precedents' for Eurozone

A Financial Times leader article (£) has said that the Cyprus bailout has set "profound precedents" for Eurozone banking.

A contemplated deposit raid and actual capital controls will weigh on the European economy.

Against that, some healthy precedents are set by the deal. Broke banks can be resolved and not kept alive by the taxpayers of their own or other countries.

The hierarchy of claims will be respected: the bail-in of senior bonds is a big improvement on earlier “rescues”.

The quiescence of markets prove they can tell solvent debtors from insolvent ones.

– Financial Times

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Cyprus central bank to limit money movement temporarily

Nicos Anastasiades speaking this evening.

Cyprus will introduce capital restrictions to prevent an outflow of money when its banks reopen this week but the measures will be "very temporary," President Nicos Anastasiades said this evening.

"The central bank will implement capital controls on transactions," he said in a televised address to the nation.

"I want to assure you that this will be a very temporary measure that will gradually be relaxed."

Anastasiades said the bailout deal reached overnight in frantic talks with the island's partners in the eurozone was "painful" but the best under the circumstances.

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US Treasury welcomes Cyprus rescue plan

The US Treasury Department has welcomed the 'bail-in' agreement Cyprus has reached with international lenders, saying the financial stability in the eurozone was important to the United States.

The US Treasury said the agreement was "critical" and that they were monitoring developments closely.

It is critical to lay the foundation for a return to financial stability and growth in Cyprus. We will continue monitoring developments closely as details are finalized and the agreement is implemented.

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