ECB Chief Rejects Calls to Rescue Europe
In his first speech as president of the European Central Bank, Mario Draghi criticized euro-zone leaders for being slow to implement their so-called comprehensive plans to resolve the sovereign debt crisis, while giving no hope that the ECB might participate in any sort of rescue.
Draghi implicitly rejected ever-louder calls for the ECB to use its resources to buy Spanish and Italian bonds in order to keep down climbing borrowing costs that threaten the nations’ solvency, and by extension the global economy. Draghi said the bank would not deviate from its focus on price stability, adding that other measures would only undercut the bank’s credibility.
Many analysts believe that, should the collapse of the euro seem imminent, the ECB would step in as lender of last resort, but the bank is far from coming to that same conclusion, instead insisting that countries take steps to cut budget deficits and boost economic growth.