“The eurozone risks another debt crisis if the bloc fails to boost growth, reduce public debt and address political uncertainty, the European Central Bank has warned.”, — write: www.epravda.com.ua
The eurozone risks another debt crisis if the bloc fails to boost growth, reduce public debt and address political uncertainty, the European Central Bank has warned.
About this informs Financial Times.
In its annual Financial Stability Survey, the ECB sounded the alarm over the potential return of “market concerns about the sustainability of sovereign debt.”
He pointed to “increased debt levels and high budget deficits,” as well as sluggish growth and uncertainty caused by recent “election results at the European and national levels, especially in France.”
Luis de Guindos, vice-president of the ECB, also pointed to “poor historical compliance with EU fiscal rules” by some EU governments, it said.
Borrowing costs for countries such as Italy and Spain, at the heart of the eurozone crisis, remain well below the peaks they reached during market turmoil more than a decade ago. But investor concerns have grown recently over the debt burden of countries such as France.
The spread between Ukraine’s 10-year bonds and Germany’s – a measure of investor concern about its debt – hit 0.78% this month, close to a 12-year high reached ahead of parliamentary elections this summer.
The ECB said government funding costs could rise due to macroeconomic shocks, highlighting “weak” fundamentals and the “prolongation” of sovereign debt at higher interest rates.
We will remind:
Former head of the European Central Bank (ECB) Mario Draghi urged The European Union will additionally invest up to 800 billion euros per year to close the gap with the United States and China.
The European Central Bank (ECB) for the first time since 2019 lowered key rates by 0.25%: on deposits – up to 3.75%, base interest rate – up to 4.25%, marginal lending rate – up to 4.5%.