Euro zone not facing new debt crisis, says EU's Jean-Claude Juncker

A governing coalition comprising two parties hostile to the euro was installed in Italy on Friday, calming markets spooked by the possibility of a new election that might have become a referendum on quitting the single currency.

There is no threat of a new sovereign debt crisis in the euro zone despite an anti-establishment coalition government taking power in Italy, European Commission President Jean-Claude Juncker said. Image source: Reuters

Asked by the RND network of German newspapers if the single currency bloc faced a new crisis, Juncker said: "No. The reactions of the financial markets are irrational. People should not draw political conclusions from every fluctuation in the stock market. Investors have been wrong on so many occasions before."

A governing coalition comprising two parties hostile to the euro was installed in Italy on Friday, calming markets spooked by the possibility of a new election that might have become a referendum on quitting the single currency.

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"I am certain the Italians have a keen sense of what is good for their country," Juncker said. "They will sort it out."

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Euro Zone Economy