Ireland has returned to the debt markets, peripheral bond yields have fallen and equities have rallied to 22-month highs. What can possibly go wrong?
Quite a lot, according to Moritz Kraemer, lead analyst at ratings agency Standard & Poor's, who told CNBC that complacency could be creeping back in.
"There is a danger of declaring victory prematurely," he told CNBC Thursday.
Kraemer underlined the good work done by the European Central Bank in putting in place the euro zone's permanent rescue fund known as the European Stability Mechanism as well as launching a new bond buying plan known as Outright Monetary Transactions. However, he said it could still come undone if economic, political and social challenges were not addressed.
"None of these instruments have been tested and implementation risks remain, especially when the sense of urgency may be on the wane," he said.
"The actual structural efforts that are needed to calm this crisis for good may be falling on the backburner again. The ECB can help, but it cannot solve the crisis, that can only be done by governments."
(Read More: Is This the Year That the Euro Crisis Ends?)
Government bond yields in the periphery - often seen as an indicator of fear in the markets - have fallen in recent days. On Thursday, Spanish benchmark 10-year bond yields fell below the 5 percent level for the first time since March 2012. Italian yields on 1-year notes fell to their lowest level since January 2010 at a bond auction on the same day.
(Read More: Spain Kicks Off Tough 2013 With Strong Bond Sale)
Ireland has once again entered the long-dated debt markets as it plans to exit from its EU/IMF bailout program later this year and European shares hit 22-month closing highs on Wednesday. But Kraemer warned of the potential for a flare up.
(Read More: Ireland Raises $3.3 Billion in First Issue of 2013)
"If we had a flaring up of the crisis again, perhaps in the next quarter or two, I think this will be a complicating factor in the run-up to a general election in Germany," he said, indicating that the coalition government in the country might be much more reluctant to endorse further steps that mutualize certain risks.
"Room for maneuver may be much more constrained than last year."