Paschal Donohoe, head of the group of eurozone finance ministers, said in an interview with the Financial Times (FT) on Monday that the eurozone is not at risk of a sovereign debt crisis like the one seen a decade ago, as the bloc’s economies are in “completely different” shape nowadays.
Key comments
The current circumstances arecompletely different from the kind of crisis environment we found ourselves inwhen the bloc was caught up in a spiral of sovereign debt sales in the early 2010s.
the euro zone now has “a stronger architecture” and “a deeper foundation for our common currency.“
“We are all confident in our ability to navigate through the changes that are taking place.”
“The starting positions of the Member States in terms of their debt and deficit levels are now very, very different from what we had before the Covid hit us.”
“We will continue to need plans that carefully reduce debt. Plans to do so will have to be credible. They will have to reflect the fact that we are in an inflationary environment.”
The FT reports that Donohoe’s remarks come as ECB President Christine Lagarde prepares to face questions from MEPs in the European Parliament on Monday about her recent contrasting messages.
Source: Fx Street
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