ECB Draghi Pressures Governments for Crisis Dealing Changes

The president of the European Central Bank on Monday put pressure on governments to push ahead with plans for a closer European integration to address the crisis’ core problems.

Speaking to university students in Amsterdam, Mario Draghi said that the euro zone’s economic problems still loomed large and that calls for more action were understandable. But he also stressed the ECB’s operational limits.

“Let me be clear: undertaking structural reforms, budget consolidation and restoring bank balance sheet health is neither the responsibility nor the mandate of monetary policy,” he said in the speech text.

The ECB could not substitute for actions that other actors, including the private sector, had to take, the Italian said.

Although there was a decrease in fragmentation on the funding side, the ECB’s very accommodative monetary policy was only partly passed on to the financing conditions faced by firms and households in some euro area countries, Draghi said.

via Reuters

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza