How nice to start the week on an upbeat note. It would seem the markets rather liked the eurozone summit moves towards closer EU co-operation and agreeing to work towards fiscal union, albeit at some point in the probably distant future.

As well as a €120 billion package to boost growth, politicians have agreed on a “single supervisory mechanism” for eurozone banks, giving the ECB a wider role and which would allow the ESM bailout fund to recapitalize troubled banks directly.

Government borrowing costs fell for Ireland, Italy and Spain as the plans reduce their liability to bail out failing banks.

It is progress towards creating a banking union, but is unlikely to be a turning point or the “game changer” the Irish contingent at the summit hailed it to be. The scheme is sketchy, with no mention of a deposit guarantee scheme or a bank resolution authority and still does not address the fundamental problems the eurozone faces.

A rehabilitated banking system needs solid foundations and euroland is still on shaky ground. In short, the eurozone summit has not solved the debt crisis. But you probably did not need me to tell you that.

All eyes then are on Thursday’s ECB monthly meeting. With all the weak economic data out of the region, plus casual comments over the last few weeks, the markets are expecting a cut in official rates.