Lorenzo Bini Smaghi, a member of the executive board at the European Central Bank (ECB), on Thursday called for further research into how fiscal measures impact financial market behaviour, warning that failure to understand market dynamics could lead to further contagion in sovereign debt markets.

"The crisis has given us the opportunity to question their analytical and practical basis," Bini Smaghi said. "We have seen in some cases how financial markets react to delayed fiscal consolidation, at