However, Greece’s sovereign risk premium increased rapidly from the end of April to early May, following a further revision to its budget deficit estimate, a sharp downgrading of Greek government bonds by a major credit rating agency, and successive news reports about the escalation of street protests in Greece. In response, worldwide stock prices tumbled and foreign exchange rates fluctuated sharply.
For example, the Dow Jones Industrial Average experienced its largest recorded intraday points fall on May 6, 2010. To address this situation, the European Union agreed on a 500 billion euro emergency loan package, the European Stabilization Mechanism, with the International Monetary Fund (IMF) pledging additional funds.