The euro rose to its highest level in several weeks after European Union finance ministers offered a massive loan package to Greece should it need it. But some analysts fear the EU measure is a short-term solution.
European Union officials and some economists have hailed the $41 billion rescue package of low-interest loans announced by EU finance ministers. Along with expectations the International Monetary Fund could offer another $20 billion, that amounts to a significant cushion for Greece, which is struggling under a massive government debt and deficit.
So far, Athens has not made a formal request for EU assistance. But analysts expect that at the very least, Europe's response should help reassure international investors and lower the interest rates on the loans they are offering.
But Simon Tilford, chief economist at the Center for European Reform in London, has reservations about the EU's action.
"It's a short-term palliative. It's positive but it's unfortunate that it took a crisis, or a speculative attack by investors, to bring the EU to this point," he said. "This should have happened weeks and weeks ago."
French analyst Philippe Moreau Defarges calls the EU rescue package a "minimalist solution" - and only a first step.
"It's just the beginning. There will be many more discussions about what should be done for Greece and other European countries," he said.
Weeks of discussions have already taken place about what to do for Greece. Germany, the EU's biggest economy, has opposed bailout efforts, arguing Athens was responsible for its economic crisis.
Tilford says the new EU loan package does not address Greece's long-term problem.
"Going forward, the only way a country like Greece is going to ensure its public finances are sustainable is if it can get its economy growing," he said. "And that goes for other economies that are similar to Greece, such as Spain, Portugal, Ireland, Italy."
The Greek crisis is considered the biggest test to date facing the 16 nations sharing the euro currency.