The head of the European Central Bank is signaling that the ECB may be ready to offer short-term loans to the monetary union's most at-risk members like Spain and Italy.

Mario Draghi, in a closed session Monday of the European Parliament, said the central bank is open to buying two- and three-year bonds of strugging euro zone members.

Draghi's comments help boost the value of the euro above $1.26 on Monday, though by Tuesday morning it had slipped to just beneath that level. It also helped cut the costs that Italy and Spain must pay to borrow money for two or three years.