Trading volumes in financial markets had been unusually light during August, even allowing for seasonal variations. Market participants had remained focused on the prospects for changes in policy in the major economies, particularly in the euro area. Some clarification was expected from the ECB at its September policy meeting on what steps it would take to reduce the perceived risk of currency redenomination incorporated into the yields on the sovereign debt of some euro-area member states. In anticipation of this announcement, Spanish and Italian government bond yields had fallen, particularly for bonds with short ... (full story)