ECB rate cuts won't fix Greece
Let's be clear, a short-term rate cut will not put the Grecian Humptyos Dumptyos back together again but it certainly will make some shorts uncomfortable. People are asking me what I mean by "" This is what I mean...
From Bloomberg:
The European Central Bank may step up efforts to boost growth and ease financial-market tensions as early as next month, Governing Council members said.
Austria鈥檚 Ewald Nowotny and Belgium鈥檚 Luc Coene said in Washington that potential measures include the reintroduction of 12-month loans to banks. Asked if an interest-rate cut is warranted, Coene said while that wouldn鈥檛 help to bring down longer-term borrowing costs, 鈥渢he ECB has never ruled out things beforehand.鈥�
鈥淚f the data in early October shows that things are worse than we anticipated we will look at the kind of decisions we have to take for that,鈥� he said in an interview late yesterday.
The ECB Council next convenes on October 6th. But they may not wait quite that long with the way asset markets acted this week.
