ECB chief Mario Draghi says worst of debt crisis in Europe ‘is over’

European Central Bank President Mario Draghi said the worst of the sovereign debt crisis is over, Germany’s Bild newspaper reported, citing an interview.

22 March 2012, 12:00am
by Karl Stagno-Navarra

1 min read

European Central Banch President Mario Draghi

"The worst is over, but there are still risks," Draghi was quoted as saying. "The situation has stabilized. The important indicators for the euro zone, like inflation, current account and above all the budget deficits, are better than, for example, in the United States."

Investor confidence has returned and "the ball is now with governments," Draghi said, according to Bild. "They must sustainably secure the euro zone against crises."

Draghi also said Germany is a "role model" in Europe, and the ECB's 23-member Governing Council, which contains two Germans, has "internalized" Germany's stability culture, Bild reported. Draghi shares Bundesbank President Jens Weidmann's concerns about the risks the ECB has taken and there is no north-south divide on the council, the newspaper said.

If the inflation outlook worsens, the ECB "will immediately act pre-emptively," Draghi said, according to Bild. However, if oil and tax increases are taken into account, inflation remains stable at around 1.5 percent, he said. The ECB's lending to banks won't fuel inflation, Draghi was quoted as saying.