MNI BRIEF: Need Debt Reduction To Assuage Markets-EU Watchdog

The European Fiscal Board – the EU’s fiscal watchdog – warned Wednesday on the “high level of debt” and “dangerous debt dynamics” in its annual report.

"Debt stabilisation, not to speak of visible debt reduction, will be highly demanding – but it has to start. The direction is essential, not least to assuage financial markets,” EFB Chair Niels Thygesen writes

The EFB chief concedes the German-made case for tough ‘safeguards’ in any new EU fiscal regime to ensure high-debt countries pursue serious debt-consolidation efforts but argues that there are other ways of achieving that, but argues a new EU fiscal regime should not be delayed any longer, he says. (MNI INTERVIEW: Loose Fiscal Policy Could Push ECB Rates Higher)