Market news
14.04.2011, 09:08

ECB BINI SMAGHI: At end of easing cycle, rates low, as in 2005

  • Low rates less justified as deflation risks recede
  • ECB studying how to return to competitive bidding on refi ops
  • Most data confirm sustained global growth 
  • Sustained global growth also transmitted to euro area
  • Euro's effective real fx rate 10% lower than 2005
  • ECB can't base monetary policy on 2-3 nations w/10% of EMU GDP
  • Greek debt restructuring would devastate greece
  • Debt restructure would bring Greek economy to knees
  • Greece restructure would strengthen eurosceptics
  • Debt restructure would cause Greek bank system failure
  • Other states must not push Greece to restructure debt
  • No option for greece but to implement EU-IMF plan
  • Post-2013, debt restructures must remain "exceptional"
  • ECB to suspend Portugal rating criteria if it accepts EU-IMF plan 

 




 

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