| CATEGORY: INTERNATIONAL ECONOMIC |
Fri 27 Jul 2012
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LONDON (SHARECAST) - French Finance Minister Pierre Moscovici said he trusts that the European Central Bank (ECB) would act to combat the crisis and bring down the yields on Spanish and Italian sovereign debt.
“I trust Mr. Draghi [ECB Pesident] to do exactly what is needed: to act so that markets are appeased and the interest rates for Spain and Italy’s debt can come down,” he told France 2 television in an interview.
Markets reacted euphorically yesterday to Draghi’s comments that the ECB would do “whatever is necessary, and believe me when I say, it will be enough."
Yet, investors seemed to turn a deaf ear to the details as the ECB President's comments really offered little news. Markets appeared to conveniently ignore that Draghi simply repeated that any action would be in line with his mandate and that he would not take any action that would supplant what governments themselves should be doing.
Investors’ hopes seemed to be pinned on the idea that Draghi was hinting at the possibility of once again purchasing Spanish and Italian sovereign debt.
JM
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