The European Central Bank remains the most likely institution to come to the aid of heavily indebted euro-area nations, said David Riley, the head of Fitch Ratings’ sovereign-debt unit.
Many shareholders in the International Monetary Fund “will look at what’s going on in Europe and say that these are pretty wealthy countries and they should be able to sort this out themselves,” Riley said in an interview today with Bloomberg Television’s Maryam Nemazee. “The ECB is the only pan-European institution that can provide the bridge financing to the new euro zone.”
The ECB has so far mostly taken the view that the euro region’s problems are fiscal, not monetary, Riley said. European leaders may take steps at a Brussels summit next week toward a closer fiscal union to persuade the ECB to play a more activist role in the crisis, he said.
“At the December 9 summit they will be looking less to impress the markets than to impress the ECB,” Riley said.