The euro area banks opt for security provided by the European Central Bank instead of seeking higher yields.

This morning made ​​public the data on deposits accumulated by European banks in the European Central Bank last Friday, following the second auction to three years. With this maneuver the divided community financial institution 529 531 000 800 euros between European banks . These data show the increase in overnight deposits in European banks, which has increased by more than EUR 776 941 000 immediately after the injection of liquidity on Wednesday. The European Central Bank is paying them the money deposited daily by banks in the euro area to 0.25 percent, a yield less than 1 percent of the official price of money.


Paramo says ECB funds will be used for loans

Executive Committee member of the European Central Bank, Jose Manuel Gonzalez-Paramo , said today at the International Finance Conference held in Madrid these days, that loans to three years, made ​​in the last week by the European Central Bank help to revive the credit of the countries in need. Paramo emphasized the positive effect this has had liquidity in Spanish banking, ” allowing banks to access the market regardless of the finances of his sovereign “and said” there have been Spanish banks that issue bonds not guaranteed senior notes, of bonds, which have not been able to do since May or June of last year . “

Inyecciiones Rubalcaba said that liquidity will not solve the crisis

The secretary general of the PSOE, Alfredo Pérez Rubalcaba, has acknowledged that injections of liquidity the European Central Bank has allowed Spanish banks to solve ” some problems “and “stabilize” the market for debt but has not been able to settle with it or the economic crisis or debt crisis. Rubalcaba has insisted that this will require mutualise Eurobond European debts or other mechanisms as well as reforming the role of the European Central Bank. At this point the secretary general of the PSOE has returned to claim the need for a tax on financial trasacciones.

The current responsibility of the European Central Bank

To date, the European Central Bank’s responsibility was to maintain price stability, especially in countries that use the euro, and maintain financial stability, ensuring adequate supervision of institutions and markets. The European Central Bank is working with the central banks of the twenty-seven European Union countries and also heads the central bank cooperation in the euro area, ie, the ” Eurosystem “.

Monetary policy contained in the monthly bulletin of the European Central Bank
The February newsletter of the European Central Bank states in its editorial that ” in the coming months is essential that monetary policy maintains price stability in the euro area as a whole, ensuring the anchoring of inflation expectations line with the Council’s aim of keeping inflation Rule Government at rates below 2 percent over the medium term . “

The bulletin explains that ” since in December 2011 was performed the first operation of longer-term financing (LTROs) to three years, the Governing Council has adopted specific measures on national eligibility criteria and risk control measures so that in some countries other criteria may be temporarily accepted as collateral in Eurosystem credit operations, which will help to increase the collateral available. ”