The raging European sovereign debt crisis intensified during the quarter as problems spread from the periphery to core countries. The escalating borrowing costs of Italy and Spain brought into question the ability of core economies to devise a sufficient rescue package. The challenging political environment led to the resignation of both the Greek and Italian Prime Ministers. It also demanded more coordinated measures from politicians and officials to stabilise the crisis and prevent it from escalating. The measures were met with varying degrees of pessimism and the impact of the crisis started to spread beyond the borders of Europe. Borrowing costs in many parts of the world have been pushed up and stock markets have been put under pressure. Global growth has slowed down drastically.