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Reuters reports that the bank's research team feel the euro is coming to "its last days as we know it", with drastic action needed to prevent bond markets in the region from collapsing as their prices edge higher.
"Pressure on Italian and Spanish bond yields may get worse even as they deliver reforms - ten-year yields spiking above nine per cent for a period is possible," it warned.
This pressure, Credit Suisse feels, is likely to spark a debate over the fiscal union which will force France and Germany to agree a deal and perhaps lead to the intervention of the European Central Bank to safeguard the common currency.
Indecision on the continent has spooked investors in recent weeks and the dollar reached a six-week high yesterday as traders treated it as a safe-haven from riskier currencies.
Posted by Greg Secker
