EU treaty hopes come under strain

Franco-German hopes for a sweeping new treaty to bind the region’s economies more closely came under strain on Tuesday as several EU leaders warned of difficulties pushing a far-reaching pact through their national parliaments, says the FT. The pressure was particularly acute in non-eurozone countries, where at least four governments — the Czech Republic, Hungary, Sweden and Denmark — signalled that the precise legal text would determine whether they could sign up to the treaty or otherwise join the UK on the sidelines. Even inside the 17-member eurozone, cracks emerged, with Irish opposition leaders calling on Enda Kenny, prime minister, to allow a referendum on the new pact. The euro slumped to its lowest level against the dollar since January. The single currency had been losing ground since Friday amid market disappointment at the outcome of the EU summit. Traders said that a seasonal dip in market liquidity had exacerbated the falls. EU president Herman Van Rompuy told the European Parliament in Strasbourg that the UK’s veto would complicate the task of implementing new, stricter fiscal rules, reports the WSJ.