BRUSSELS (MNI) – European Central Bank President Mario Draghi
praised a pledge by European leaders to deepen their economic
cooperation after a summit in Brussels that ended in the early hours of
Thursday morning.
“Their commitment to move the economic and monetary union to a new
stage” was the “most important thing” to come out of the summit, Draghi
told journalists.
He said the EU leaders did not discuss amending the ECB’s mandate,
and that all 27 of them fully appreciated the importance of the central
bank’s independence for the stability of the Eurozone.
The ECB president also said there was “a general sense that the ESM
should be a functioning firewall” and that there was no sense in giving
it anything that “is not already there.”
Before the summit, some countries had suggested that the ESM — the
EU’s permanent bailout fund, scheduled to be launched July 1 — be
granted new powers to directly aid banks rather than going through
governments, and also that it be given a banking license so that it can
tap liquidity from the ECB.
Draghi denied that Spanish Prime Minister Mariano Rajoy had asked
the ECB to help Spain with liquidity support, as Rajoy had said he
would. Instead, the Spanish premier made a general call for liquidity
that “could be provided by other sources,” Draghi said.
On the idea that Eurozone governments should mutualize some debt
issuance, the ECB president said he thought such bonds “should come at
the end of a process” of fiscal union and not used to kick start it.
–Brussels Newsroom, +324-952-28374; pkoh@marketnews.com
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