ECB won’t solve profound debt issues: Rehn
The European Central Bank should limit the rise in borrowing costs of more indebted euro zone members but will not solve their debt issues or let budget concerns dictate monetary policy, ECB policymaker Olli Rehn said on Saturday. In an emergency meeting this week, the ECB decided to direct bond reinvestment to help nations on the bloc’s southern rim, and to devise a new instrument to contain divergence in borrowing costs. But ECB action will only go as far as preventing “unwarranted” market moves and will not help countries in case of profound debt issues, Rehn, Finland’s central bank chief, said at an event organized by the Dallas Federal Reserve.
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