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Feb 27, 2013

No broad “bail-in” for Cyprus depositors, ECB says

FRANKFURT (Reuters) – Depositors in Cypriot banks should not be forced to take losses across the board as part of a euro zone rescue of Cyprus, ECB policymaker Benoit Coeure said, but he did not rule out making the biggest depositors share some of the burden.

Speaking at a Reuters Summit on the future of the euro zone, Coeure said it was essential to ensure that Cypriot debt is reduced to a manageable level and that the cost of the bailout is fairly shared and not just footed by taxpayers.

Feb 27, 2013

Bond-buying plan is there to be used: ECB’s Coeure

FRANKFURT (Reuters) – The European Central Bank’s bond-purchase program is “not a nuclear deterrent” and is available for use, ECB policymaker Benoit Coeure said, with Ireland and Portugal candidates to tap the plan when they gain more access to debt markets.

The ECB launched the program – dubbed Outright Monetary Transactions (OMT) – last September to counter investor fears of a euro zone break-up but it has yet to deploy it, with some policymakers at the bank preferring to keep it under wraps.

Feb 22, 2013

Banks repay less ECB crisis loans than expected

FRANKFURT, Feb 22 (Reuters) – Banks will repay the European
Central Bank 61.1 billion euros in the second of two 3-year
loans they took a year ago, handing back less than expected in a
sign much of the euro zone financial system is still reliant on
ECB funds.

The ECB said on Friday that 356 banks had decided to repay
funds from the second loan at the earliest opportunity, on Feb.
27. A total of 800 banks tapped the operation in February 2012.

Feb 19, 2013

German investor morale soars to near 3-year high

MANNHEIM, Germany, Feb 19 (Reuters) – Optimism that the
worst of the euro zone debt crisis is over has helped German
investor sentiment soar to its highest level in nearly three
years this month.

In the latest sign that Europe’s largest economy is bouncing
back after a dismal end to 2012, the Mannheim-based ZEW think
tank said on Tuesday its monthly investor and analyst poll of
economic sentiment rose to 48.2 points in February from 31.5 in

Feb 18, 2013

Core Eurozone banks relying less on crisis funding

FRANKFURT, Feb 18 (Reuters) – German banks’ use of European
Central Bank crisis funding dropped by a third in January from
the previous month, a further sign that banks in the heart of
the euro zone are returning to money markets after last year’s
credit squeeze.

Banks in countries on the periphery of the 17-member bloc
still rely on central bank lending, which, while at a record-low
interest rate of 0.75 percent, is above market rates. The
divergence complicates the ECB’s interest rate-setting plans.

Feb 12, 2013

ECB’s Constancio expects G20 floating FX commitment

HELSINKI, Feb 12 (Reuters) – The Group of 20 industrialised
nations should reaffirm their commitment to floating exchange
rates at their upcoming Moscow meeting, European Central Bank
Vice President Vitor Constancio said on Tuesday.

The G20 accounts for 90 percent of the world’s economy and
two-thirds of its population. Russia currently heads the group,
which has been split between borrowers seeking to grow out of a
debt trap and surplus countries keener on austerity.

Jan 30, 2013

Banks repay ECB crisis funds, toughen lending standards

FRANKFURT (Reuters) – Banks began early repayment of crisis funds to the European Central Bank on Wednesday, shrinking the ECB’s balance sheet while the world’s other big central banks are still spending to support their economies.

Combined with lackluster demand for weekly funding, it helped boost the euro to its highest level against the dollar since November 2011.

Jan 29, 2013

Ireland, Portugal may not get a taste of ECB bond buys

FRANKFURT/DUBLIN (Reuters) – The European Central Bank appears happy to leave Ireland and Portugal to fend for themselves, holding off directly buying the bail-out recipients’ debt unless markets turn sour again.

Both Ireland and Portugal have re-entered sovereign bond markets recently, but the ECB has left investors and governments guessing about when it could use its new bond-buying programme, known as Outright Monetary Transactions (OMT).

Jan 22, 2013

German investor sentiment at highest since May 2010

MANNHEIM, Germany (Reuters) – German analyst and investor morale rose to its highest level in more than 2-1/2 years in January, in a sign the euro zone crisis is no longer hitting Europe’s largest economy as hard as it was late last year.

The Mannheim-based ZEW think tank said its monthly poll of economic sentiment climbed for a second month to reach its highest level since May 2010, rising to 31.5 points from 6.9 in December. It was the biggest monthly rise in a year.

Jan 15, 2013

German economy contracted 0.5 percent in fourth quarter on euro crisis

WIESBADEN, Germany (Reuters) – The German economy contracted by a larger-than-expected 0.5 percent in the final quarter of 2012, a preliminary estimate from the Federal Statistics office showed on Tuesday, as the euro zone crisis weighed on exports and corporate investment.

The weak fourth quarter pushed overall growth for the year down to 0.7 percent, a sharp slowdown from the 3.0 percent registered in 2011 and a post-reunification record of 4.2 percent in 2010. The 2012 figure was below a Reuters consensus forecast for a growth rate of 0.8 percent.

    • About Sakari

      "I am part of the Reuters team covering the European Central Bank. Before moving to Frankfurt in early 2009, I was based in Helsinki, where I wrote about the Finnish economy and paper industry."
      Joined Reuters:
      Finnish, English, German, Swedish
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