Bundesbanks Weidmann: Loose EU monetary policy contributes to deceptive calm

Bundesbank Weidmann

He adds:

• Euro area doesn't need for reaching fiscal risk pooling to function properly
• it would be a fallacy to believe that the euro area is prepared for every eventuality and there are many ways to make it more stable
• loose monetary policy has contributed to a deceptive calm
• the European commission suggestion that the fiscal pact be put into EU law doesn't help to improve the finances of member states
• supervision of budgets should be transferred to independent authority such as ESM rescue mechanism
• while joint deposit insurance could increase trust in principle your area banks would first have to completely provision or self nonperforming loans

The ECB kept rates unchanged today and said rates would remain unchanged for an extended period of time..