European leaders agreed to drop the private-sector involvement in bailouts for European indebted nations, as Germany has finally agreed to step back from demanding investors to share the cost of bailouts, which led the debt crisis to worsen and deepen further.

The European Union President, Herman Van Rompuy said As regards private-sector involvement, we have made a major change in our doctrine: from now on we will strictly adhere to the IMF principles and doctrines, and added or, to put it more bluntly, our first approach to PSI, which had a very negative effect on debt markets is now officially over.

This decision was a part of the entire package agreed upon in Brussels by leaders earlier today, where policy markers also agreed accelerating the start of the 500 billion-euro fund to next year.