EU summit a 'breakthrough': ECB chief

15th December 2011, Comments 0 comments

The decisions taken at the EU summit last week mark a "breakthrough" but they need to be implemented quickly if the current crisis is to be resolved, European Central Bank chief Mario Draghi said Thursday.

"The decisions of the European Council summit, together with the six-pack approved recently by the European Parliament, are a breakthrough for clear fiscal rules in our monetary union," Draghi told a congress in the German capital.

"However, the crisis has not ended yet. It is now important not to lose momentum and to swiftly implement all those decisions that have been taken to put the euro area economy back on course," he said.

The ECB, under intense pressure to do more to resolve the debilitating sovereign debt crisis that is threatening to tip Europe into recession, is playing its role by cutting interest rates and supplying the region's banks with liquidity, the central bank chief said.

Last week, the bank lowered its key borrowing rate by a quarter of a percentage point to 1.0 percent, extended its provision of liquidity to banks and eased the rules on collateral that banks can use to borrow from the ECB.

Those measures "will support the flow of credit to firms and households in the euro area economy," Draghi said.

© 2011 AFP

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