Trichet Says Europe Can Resolve Its Debt Crisis by Showing Determination
European Central Bank President Jean-Claude Trichet said Europe can surmount its sovereign debt crisis by showing the will and determination to do so.
“Naturally the Europeans can manage the issue,” Trichet said in an interview with the Financial Times Deutschland, according to a transcript released yesterday by the Frankfurt- based ECB. “It is not a question of technique. It is a question of will and determination.”
Trichet said the euro is not in danger and remains “a highly credible currency.” He reiterated that the ECB will not accept as collateral bonds from a nation that defaults.
“If a country defaults, we can no longer accept as normal eligible collateral defaulted bonds issued by the government of that country,” Trichet said. “Because, in the eyes of the Governing Council, this would impair our ability to be an anchor of confidence and stability.”
In the event of a decision leading to a selective default or a default, “the governments would have to take care that the Eurosystem is presented collateral that it could accept,” he said.
Asked if German Chancellor Angela Merkel has acted too slowly during the crisis, Trichet replied: “Not in the least. I would see a discussion of this kind as being completely misplaced in the current situation.”
Leaders will meet July 21 in Brussels to discuss “the financial stability of the euro area as a whole and the future financing of the Greek program,” European Union President Herman van Rompuy said in a July 15 statement. Among topics for the talks is a potential overhaul of the 440-bllion euro ($623 billion) rescue fund to enable Greece to better pay its bills.
To contact the reporter on this story: Matthew Brockett in Frankfurt at mbrockett1@bloomberg.net
To contact the editor responsible for this story: Craig Stirling at cstirling1@bloomberg.net
European Central Bank president Jean-Claude Trichet
Hannelore Foerster/Bloomberg
European Central Bank (ECB) president Jean-Claude Trichet.
European Central Bank (ECB) president Jean-Claude Trichet. Photographer: Hannelore Foerster/Bloomberg
July 15 (Bloomberg) -- Charles Dumas, research director at Lombard Street Research Ltd., talks about Europe's sovereign debt crisis and the outlook for the European Union. Dumas also discusses the results of the EU's bank stress tests. He speaks with Tom Keene on Bloomberg Television's "Surveillance Midday." (Source: Bloomberg)
July 18 (Bloomberg) -- Keagan York, head of foreign exchange strategy at Compass Global Markets, talks about global currencies. York also discusses Europe's sovereign debt crisis and the stress tests of the region's banks, and the deficit-reduction negotiations between the White House and congressional leaders. He speaks from Sydney with Susan Li on Bloomberg Television's "First Up." (Source: Bloomberg)
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