French President Nicolas Sarkozy, German Chancellor Angela Merkel and Luxembourg’s Prime Minister Jean-Claude Juncker have called for an EU investigation into financial derivatives and want to ban speculation on these products. In a letter sent to the European Commission president and the Spanish EU Presidency, on 10 March, made public the next day, the three leaders and Greek Prime Minister George Papandreou propose that the Commission “carry out as soon as possible an investigation to determine the role and impact of speculation on CDS [credit default swaps] on bonds issued by European states”. Speculation on credit default swaps is seen as a factor in the Greek crisis, given this country’s high debt.

“If this investigation uncovers market abuse or makes it clear that speculation has a significant impact on interest rates, we will have to quickly consider taking measures and if need be adopt legislation or regulations to put an end to such speculation,” adds the text. Possible measures mentioned are a ban on speculative transactions on CDS and the buying of CDS which are not used for hedging purposes.