Forex Flash: Reasons against Eurobonds and bank integration – Merrill Lynch

FXstreet.com (Barcelona) - Merrill Lynch analysts point to the $35 Trillion of Eurozone debt that Germany can't absorve by its own, and the common rules around social spending as reasons for Germany and peripheral Europe to be against Eurobonds and a banking integration. Also, German businesses have been benefiting from low funding costs and gaining market share.

"We believe the "muddlethrough" scenario is the most likely, but politics can turn in unexpected directions. Hence, the risk of a eurozone debt deflation collapse and currency break-up will stay around for years. As such, the risk of $60/bbl Brent won't go away anytime soon", wrote Merrill Lynch economists.