News / Europe

European Central Bank Moves to Ease Debt Crisis

European Central Bank chief Jean-Claude Trichet speaks to the media during a press conference (file photo - 27 Oct. 2010)
European Central Bank chief Jean-Claude Trichet speaks to the media during a press conference (file photo - 27 Oct. 2010)

The European Central Bank moved Thursday to contain the continent's government debt crisis, extending the availability of emergency loans and keeping its benchmark lending rate at one percent.

It resisted pressure, however, to embark on a new bond-buying plan to ease the borrowing costs of debt-laden Ireland, Portugal, Spain and other countries.

Nonetheless, traders said the bank is quietly buying the sovereign bonds. The central bank's president, Jean-Claude Trichet, was reticent about the bond buying but emphasized that a bond purchase program started after the bailout of Greece last May is continuing.

The bank's actions seemed to assure investors about the soundness of the governmental bonds. Interest rates on Irish, Portuguese and Spanish bonds all dipped in late-day trading.

The central bank said it will continue to make cheap, emergency loans available to commercial banks in Europe, at least through the end of March, and to maintain its one percent benchmark lending rate for the 20th straight month.

The European Central Bank is faced with spurring economic growth at the same time as Greece, Ireland, Portugal and Spain are struggling to cut their budget deficits through a combination of cuts in key social welfare programs and increased taxes.

Trichet said the current low lending rate was appropriate and described the bank's overall monetary policy as "accommodative."

The value of the euro, the common currency used by 16 European nations, fluctuated throughout the day Thursday as investors weighed Trichet's comments and the central bank's willingness to intervene to contain the increased  governmental borrowing costs. By the end of the day, the euro's value against the dollar rose to more than $1.32.

Earlier this year, Greece was forced to take a bailout from its European counterparts and the International Monetary Fund, and Ireland followed suit last week. The fear among European financial experts and policymakers is that Portugal and Spain may soon have to do the same.

You May Like

Is Air Travel Safe?

Aviation expert says despite tragic losses of Malaysian Airlines flights 370 and 17, industry experienced lowest fatality rate in recorded history last year More

Multimedia 100 Days Later, Nigerian Girls Still Held

Activists holding rallies in Nigeria and several other countries to mark 100th day of captivity for more than 200 schoolgirls being held by Boko Haram More

Chocolate Too Bitter? Swap Sugar for Mushrooms

US food technology company develops fermentation process using mushrooms to reduce bitterness in cocoa beans, believes it will cut sugar content in candy More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
US Carriers Suspend Travel to Israeli
X
Carolyn Presutti
July 23, 2014 1:21 AM
The United States is prohibiting American carriers from flying to Israel's airport in Tel Aviv for 24 hours, because of rising violence between Israel and Hamas militants. The action was announced on Tuesday, after a rocket fired by Hamas militants in the Gaza Strip landed near the airport. As VOA's Carolyn Presutti tells us, international officials soon may have to determine which combat zones are too dangerous for commercial flights.
Video

Video US Carriers Suspend Travel to Israel

The United States is prohibiting American carriers from flying to Israel's airport in Tel Aviv for 24 hours, because of rising violence between Israel and Hamas militants. The action was announced on Tuesday, after a rocket fired by Hamas militants in the Gaza Strip landed near the airport. As VOA's Carolyn Presutti tells us, international officials soon may have to determine which combat zones are too dangerous for commercial flights.
Video

Video NASA Focuses on Earth-Like Planets

For decades, looking for life elsewhere in the universe meant listening for signals that could be from distant civilizations. But recent breakthroughs in space technology refocused some of that effort toward finding planets that may harbor life, even in its primitive form. VOA’s George Putic reports on a recent panel discussion at NASA’s headquarters, in Washington.
Video

Video IAEA: Iran Turns its Enriched Uranium Into Less Harmful Form

Iran has converted its stockpiles of enriched uranium into a less dangerous form that is more difficult to use for nuclear weapons, according to the United Nations’ Atomic Energy Agency. The move complies with an interim deal reached with Western powers on Iran's nuclear program last year, in exchange for easing of sanctions. Henry Ridgwell reports for VOA from London.
Video

Video Relic of Saint Draws Catholics Worried About Immigration Issue

A Roman Catholic saint who is a figure of devotion for those crossing the border into the United States is attracting believers concerned about the plight of undocumented immigrants. Mike O'Sullivan reports from Los Angeles, where a relic of Saint Toribio has drawn thousands to local churches.
Video

Video US Awards Medal of Honor for Heroics in Bloodiest of Afghan Battles

U.S. combat troops are withdrawing from Afghanistan, on pace to leave the country by the end of this year. But on Monday, U.S. President Barack Obama took time to honor a soldier whose actions while under fire in Afghanistan earned him the Medal of Honor. VOA's Jeff Seldin has more from the Pentagon.
Video

Video Ukraine Rebels Surrender MH17 Black Boxes

After days of negotiations, a senior separatist leader handed over two black boxes from an airliner downed over eastern Ukraine to Malaysian experts early Tuesday. While on Monday, the U.N. Security Council unanimously demanded that armed groups controlling the crash site allow safe and unrestricted access to the wreckage.
Video

Video In Cambodia, HIV Diagnosis Brings Deadly Shame

Although HIV/AIDS is now a treatable condition, a positive diagnosis is still a life altering experience. In Cambodia, people living with HIV are often disowned by friends, family and the community. This humiliation can be unbearable. We bring you one Cambodian woman’s struggle to overcome a life tragedy and her own HIV positive diagnosis.
Video

Video Nature of Space Exploration Enters New Age

Forty-five years ago this month, the first humans walked on the moon. It was during an era of the space race between the United States and the Soviet Union. World politics have changed since then and -- as Elizabeth Lee reports -- so has the nature of space exploration.

AppleAndroid