European Central Bank must losen up

Above all the European Central Bank is to blame for Italy's now having to pay interest rates of over seven percent on its government bonds, writes the liberal business paper Les Echos: "Why is it that England can borrow money at an interest rate of 2.2 percent over ten years while Italy must pay 7.4 percent, even though Britain's state finances are in worse shape than Italy's? The difference between the two countries depends among other things on the role played by the central banks. As in all big countries, the central bank, the Bank of England, acts as a lender of last resort. ... The head of the US Federal Reserve, Ben Bernanke, cooled the panic on financial markets in 2008 by reminding people that if need be the Fed would also act as lender of last resort. The Eurozone is endangered because the ECB is unwilling to take on such a role. This must change. It doesn't mean becoming overly lax or losing credibility. Other central banks are ample proof of that."

» full article (external link, French)
More from the press review on the subject » Fiscal Policy, » Financial Markets, » Banks, » United Kingdom, » Italy, » Europe
All available articles from » Nicolas Barré
Who's saying what » Ways out of the debt crisis

» To the complete press review of Thursday, November 10, 2011