| Author (Person) | Johnson, Miles |
|---|---|
| Series Title | Financial Times |
| Series Details | 3.8.12 |
| Publication Date | 03/08/2012 |
| Content Type | News |
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Report of the monthly meeting of the ECB Monetary Policy Committee and the comments of ECB President Mario Draghi in Frankfurt, 2 August 2012, on possible ECB measures to help contries such as Italy and Spain. Mr Draghi said 'The Governing Council extensively discussed the policy options to address the severe malfunctioning in the price formation process in the bond markets of euro area countries. Exceptionally high risk premia are observed in government bond prices in several countries and financial fragmentation hinders the effective working of monetary policy. Risk premia that are related to fears of the reversibility of the euro are unacceptable, and they need to be addressed in a fundamental manner. The euro is irreversible'. In its article the FT reported that Italy and Spain both declined to say afterwards whether they would request that Europe’s rescue fund buy their governments’ debt after Mario Draghi had said no such aid would come unless the countries accepted strict conditions (a German demand) Instead Mario Monti, Italy’s Prime Minster, and Spanish Prime Minister Mariano Rajoy Italy issued a joint call to speed up plans for closer European financial integration, as they attempted to deflect pressure from the ECB to accept a painful economic reform programme in return for relief from financial markets. European markets fell on the news from the ECB. Analysts had been hoping for more details and immediate action. |
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| Subject Categories | Economic and Financial Affairs |
| Countries / Regions | Europe, Italy, Spain |
