European Union's Economic and Monetary Affairs Commissioner Olli Rehn waits for Italy's Prime Minister Mario Monti prior their meeting on November 25, at Palazzo Chigi, Italy's Prime Ministry in Rome.

From Washington to Sydney, in dollars, yen or the crisis-hit euro, traders reacted with relief after battered lenders learned they would be flooded with newly created cash in a bid to avert a depression and deep social unrest.

But the lingering threat of meltdown weeks from Christmas and dire warnings of conflict returning to Europe meant EU leaders still have central issues to resolve at a pivotal summit on Friday, December 9.

Global stocks and the euro each surged after six central banks -- for the eurozone, the United States, Japan, Britain, Switzerland and Canada -- took the wrappers off joint "liquidity support to the global financial system."

In the first major market opening of Thursday, Australian shares powered almost three percent higher fresh from US stocks soaring by four percent on the back of similar rises in London and across Europe.

The Tokyo opening was also up 1.74 percent, with South Korean shares opening 3.46 percent higher.

Central banks want to boost confidence on markets wearied by the failure of what French Foreign Minister Alain Juppe called an "existential" crisis, which risks destroying a border-free ideal built on the rubble of World War II.

In September, Polish Finance Minister Jacek Rostowski warned that a collapse of the European Union could even lead to war.

Picking up on those fears, Juppe said: "We have flattered ourselves for decades that we have eradicated the danger of conflict inside our continent, but let's not be too sure."

Government finance consultant Sony Kapoor of Re-Define said that while central bankers had provided an impressive "cushion" against panic, it did not obscure the "dark shadow" cast over the world economy.

Nearly two years after faked Athens accounts unleashed a public-debt virus swirling outwards from the Mediterranean, the problem remains how to reassure markets.

Seven days from the start of their summit, Olli Rehn, European commissioner for monetary affairs, said the entire 27-state European Union risked "disintegrating".

The EU, battling to prevent its 12-year-old eurozone splitting into 'good' and 'bad' countries, was now plunged into "a critical period" when it had to "complete and conclude the crisis response."

At the sharp end, commercial banks are stuck with depreciating government bonds.

Wary of each other, growth has stalled amid pressure to reduce lending to households and businesses -- especially across borders.

The US Federal Reserve and the others said they would fund banks at low rates until February 2013 in order to "mitigate the effects of such strains on the supply of credit."

It's a classic gambit -- echoing similar action in May 2010, when the EU first acknowledged that the Greek drama could destabilise markets worldwide.

From US Treasury Secretary Timothy Geithner to Japan's Masaaki Shirakawa the reaction was one of "relief."

But it didn't dispel the clouds over the EU.

Already bailed-out Ireland's Prime Minister Enda Kenny dispensed with niceties about political independence to insist that the only plausible answer was for the European Central Bank (ECB) to stand behind an "effective and credible" bad-debt firewall.

"This problem must be dealt with politically -- and dealt with now," Kenny said.

Others expressed similar sentiments, but until Germany can remodel the entire currency area in its own smart image -- including France, perched on the edge of a humiliating credit downgrade with a badly-exposed banking sector -- diplomats say Berlin will not budge.

Letting the ECB guarantee other euro states' debt represents in Germany a breach of trust seen as a certain precursor to rampant price rises -- the sort that scarred the years in which Hitler rose to power.

Amid calls for the ECB to join forces with the International Monetary Fund to save the day, Italy's new Prime Minister Mario Monti insisted that an approach to the latter for bailout loans was "never envisaged".

In Mexico, IMF managing director Christine Lagarde also dismissed "wonderful rumours" it was preparing cash aid for Italy and Spain.

Unemployment in Spain -- already at a euro-area record 10.3 percent -- reached a breathtaking 48.9 percent for the under-25s according to new EU data published Wednesday.

"We stand ready to help," the former French finance minister said, "not just countries of the eurozone but also those that we call the crisis bystanders."

Eurozone neighbours Hungary and Tunisia have themselves required help.

Monti, who as well as being premier is Italy's acting finance minister, still faces intense pressure on bond markets over a debt mountain of nearly two trillion euros, amid fears of a "run" on the country.

Rome is under EU orders backed by the IMF to shield its public finances with a multi-billion-euro 2012 budget "buffer," which he will unveil on Monday.