Bundesbank President Jens Weidmann said “the generous supply” of liquidity from the European Central Bank must not result in banks and governments postponing necessary reforms, Frankfurter Allgemeine Sonntagszeitung reported.
European banks need to “thoroughly adjust” balance sheets and strengthen capital levels while governments have to quickly implement structural reforms and credibly consolidate budgets, the newspaper cited Weidmann as saying in a preview of a story that will run tomorrow. If countries need bridging help during that process, providing such aid is the task of European rescue programs and not of central banks, Weidmann said.
Central banks’ monetary measures must “not replace, nor delay, adjustments,” Weidmann told the German newspaper.
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