Officials have struck out a pact that will see both the size and scope of the rescue fund strengthened, rather than choosing to buy bonds or finance buybacks, Bloomberg reports.
The terms of the Greek rescue loans were also eased as part of the developments.
John Stopford, head of fixed income at Investec Asset Management, said: "Policymakers understand that market sentiment is crucial, and at least in the near-term, these measures are likely to improve sentiment."
The euro witnessed gains and there were rallies from the most indebted nations, helping to reverse a slump last week that adversely affected Greece and Portugal in particular, the news provider added.
Last week, regulators in Spain told the country's banks to increase their capital holdings to help protect them from any crises in the future.
By Tony Aynsley