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MNI BRIEF: Eurogroup Backs ECB Anti-Fragmentation Tool Ideas

(MNI) Brussels

Euro Area finance ministers backed the proposal of the ECB to rapidly work towards a new anti-fragmentation tool, EU Economy Commissioner Paolo Gentiloni said Thursday following the Eurogroup meeting in Luxembourg. “Overall, there was recognition of the importance of the commitment of the ECB to work to prevent the risk of unjustifiable fragmentation in the transmission of our monetary policy,” he said.

Eurogroup President and Irish Finance Minister Paschal Donohoe added that there had been no discussion of any conditionality that might be attached to the deployment of the ECB’s new fragmentation tool. Earlier, reports suggested ECB President Christine Lagarde was reported saying anti-fragmentation tools will be used if bond yields of stresses countries rise too far, too fast.

This week, Francesco Papadia, formerly a senior ECB official, told MNI the central bank would overcome any obstacles to a new tool (MNI INTERVIEW: ECB To Overcome Obstacles To New Crisis Tool)

MNI London Bureau | +44 203-865-3812 | les.commons@marketnews.com
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MNI London Bureau | +44 203-865-3812 | les.commons@marketnews.com
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