Draghi urges banks to boost liquidity / Doubts over ECB move to boost bond sales

Report of the first major public speech given by the new President of the European Central Bank, Mario Draghi, in Berlin on the 15 December 2011 (Ludwig Erhard Lecture). Discussing the eurozone debt crisis he urged commercial banks to exploit radical new measures taken by the ECB to increase liquidity in the European banking system, in order to maintain lending to the real economy and prevent a renewed credit crunch.

Mr Draghi also said the ECB action was only one element in fighting the eurozone crisis. National governments must reduce their own borrowing, and take measures to boost growth.

He praised the decisions taken by the European Union summit in Brussels, 8-9 December 2011 as 'a breakthrough for clear fiscal rules in our monetary union'.

ESO: Background information: Eurozone countries sign-up to closer ties http://www.europeansources.info/record/eurozone-countries-sign-up-to-closer-ties/

ESO: Background information: ECB launches new support for banks http://www.europeansources.info/record/ecb-launches-new-support-for-banks/

ECB: Speech, 15.12.11: The euro, monetary policy and the design of a fiscal compact http://www.ecb.int/press/key/date/2011/html/sp111215.en.html

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