Governor of Banco de Portugal says that a financial crisis “cannot be a risk taken off the table” – Coimbra News
The governor of the Bank of Portugal said today that the risk of a current economic crisis turning into a financial crisis cannot be ruled out and underlined that the ECB’s role is to guarantee measures to prevent.
“From a central bank’s point of view, we have to ensure that this economic crisis that is on the horizon – which is a threat – does not turn into a crisis. […] These risks cannot be removed from the table, because we always have measures to take care of them”, said Mário Centeno, who participated in the CNN Portugal Summit conference, at Culturgest, in Lisbon.
In a conversation with the executive director of CNN Portugal, Pedro Santos Guerreiro, about inflation and monetary policy, the former Minister of Finance stressed that, from the point of view of monetary policy, there is availability at European level to create new instruments that introduce discipline in the market, “when the outstanding debt will be beyond the economic fundamentals”.
Last week, the European Central Bank (ECB) announced that it will create an “anti-fragmentation” instrument in debt markets, after countries such as Italy and Spain have seen risk premiums soar in recent days, compared to Germany.
“If it is well designed, [este instrumento] The tool will be used, never explaining the behavior of investors.
Considering that Europe currently has better conditions to deal with a crisis, than it had in 2008 or 2011, the governor of Banco Portugal stressed, however, that there are mistakes that cannot be repeated, such as the “old argument” of a “will” in the measures, which he considered to be “a very big temptation that exists in Europe”.
“We cannot consider that, in Europe, the risk reduction dimension of solidarity and not always hand in hand. They have to be coordinated and that’s exactly what was done in 2020 [com a pandemia]”, defended Mário Centeno.
The person in charge may be at risk of creating as well as entering a de, “semi-p”, advocating the need for conditions in which states rejected the ideaam and thus rejected themselves in and thus rejected the “desire to bring” inflation rate to 2%.