Professor Willem Buiter, the bank’s chief economist and a former UK rate-setter, said the eurozone is paralysed by a "game of chicken" between the European Central Bank and EMU governments in charge of fiscal policy.
Both sides are trying to shift responsibility onto the other for shoring up Southern Europe and Ireland, raising the risk of widening contagion. "The market is not going to wait until March for the EU authorities to get their act together. We could have several sovereign states and banks going under. They are being far too casual." he said.