Cyprus Bailout in Place - But Crisis Not Solved

Cyprus Bailout in Place - But Crisis Not Solved

Just after midnight, the Troika and Cyprus struck a last-minute deal to avoid a complete bankruptcy and potential euro exit of Cyprus
The deal does not have to be approved by the Cypriot parliament as legislation is already in place
The deal may give short-term calm but it raises new potential problems for the future as capital controls and losses on deposits set a dangerous precedence
Future problems in Greece or Spain could escalate faster as capital control and losses for deposits above EUR100,000 will now be seen as a real possibility
As the Cypriot economy is likely to suffer, more bailouts are likely to be necessary in the future