Eurozone
Greek governor paints bleak picture of life without the euro
Yannis Stournaras insists leaving the eurozone is ‘not an option’ for Greece, as it would impose ‘huge costs’ on the financial system and real economy alike
Forward guidance can help QE succeed, Finnish research says
Article in Bank of Finland bulletin considers whether eurozone is at risk of Japanese-style deflation, finding the ECB’s asset purchases reduce the odds of this outcome
Third TLTRO sees extra €98 billion borrowed from ECB
Latest allocation of cheap loans pushes total amount borrowed to €310 billion; measures aimed at repairing transmission mechanism and encouraging loans to real economy
Protestors clash with police as ECB opens new premises
Demonstrations organised to coincide with inauguration of new ECB building lead to outbreaks of violence; Draghi calls for economics and politics of integration to be ‘reconciled’
Draghi wants shared sovereignty over structural reforms
ECB president fleshes out vision for ‘common governance’ of product and labour market reforms in the eurozone; advocates adopting an ‘institution-based approach’ to common governance
Cyprus governor 'will not resign' despite political pressure
Chrystalla Georghadji will continue exercising her duties as governor despite the Cypriot president ordering an investigation into what he perceives as a ‘conflict of interest’
ECB paper models Philips curve from professional forecasts
Working paper finds the curve consistent with professional forecasts has flattened since the financial crisis, with the relationship between inflation and unemployment weakening
ECB’s Mersch tells banks to take advantage of reforms
Banks should tap into the ‘sizeable’ opportunities offered by banking union, ECB executive board member says, which could help them provide more credit to SMEs
Court rules against ECB in CCP case
European court finds ECB does not have authority to regulate securities clearing systems in the EU, upholding a UK plea against rules forcing CCPs to be located in the eurozone
ECB revisits virtual currencies in new report
Research concludes virtual currencies do not pose ‘material risk’ to central bank operations in eurozone, but could if they become more widely used or entwined with the real economy
IMF researchers add eurozone detail to fund’s global projection model
Working paper adds ‘blocks’ for Germany, France, Italy and Spain to the model in an effort to capture the dynamics in the eurozone in greater detail
Draghi defends Greek waiver decision in heated parliament session
ECB president defends bond-waiver decision and dismisses ‘popular mistakes’ over the disbursement of profits, having to raise his voice over heckling from MEPs
Spanish paper finds relationship between number of lawyers and litigation rates
Working paper published by Bank of Spain warns not to read too much into results, but finds they are useful in conducting a ‘preliminary’ evaluation of recent reforms
Carney defends eurozone comments
Parliamentary committee questions appropriateness of BoE governor calling for fiscal union in Europe; Carney admits authorities outside eurozone were keen for him to make the comments
Italian paper: Reforms could lead to earlier exit from ZLB
Working paper examines the impact of competition-friendly reforms in the service sector across the eurozone, finding it could help boost inflation providing investment responds
Greek debt deal marks start of rough road
Negotiations on Friday ended in a compromise stacked in Germany’s favour; although disaster has been temporarily averted there are more battles to come, and Greece’s funding remains tight
Greek crisis meeting gets go-ahead despite German challenge
A meeting of the Eurogroup will take place Friday after Greece yesterday sought a six-month bailout extension, but Germany has moved quickly to challenge the proposed compromise
Latest round of Greek bailout talks collapses
Discussions over extending Greece’s bailout collapsed late last night after the country's finance chief Yanis Varoufakis rejected a plan by the Eurogroup to continue with the current programme
BIS sees cross-border liquidity reverting to historical trend
Latest global liquidity indicators show low volatility combining with rapid cross-border credit growth; researchers challenge simple supply and demand theory of oil-price slump
Greenspan: Eurozone could collapse without political union
Former Fed chair Alan Greenspan says it is ‘very difficult’ to imagine the eurozone remaining intact without political union, while it is ‘just a matter of time’ before Greece departs
Danish central bank prepared to cut rates further in defence of peg
‘We haven’t yet found any absolute lower bound' for the deposit rate, Danish governor tells Central Banking, but acknowledges potential for strain on payments system
Denmark cuts deposit rate for fourth time in three weeks
Governor Lars Rohde says central bank will defend peg to euro ‘for as long as it takes', adding there is ‘no upper limit' to FX reserves as key rate is cut to -0.75%
Denmark suspends bond sales to stem FX inflows
The move, intended to lower longer-term yields and thereby discourage upwards pressure on the krone, ‘effectively works as QE' says analyst
ECB’s Cœuré calls for tougher rules on structural policy
Executive board member says a ‘strong framework’ is needed to manage the interdependence of fiscal, financial, structural and monetary policies in Europe