The ECB Responds
This post was written by John McHale
After a turbulent week, RTE’s This Week programme provides a useful stocktaking with Mark Gilbert (Bloomberg), Dan O’Brien and Brian Hayes. (You can listen here; starts min 5:19). Part of the background is a Sunday Times front-page story on the ECB’s reaction to Michael Noonan’s Washington statements (no web link). The paper quotes an unnamed ECB source,
“In the meantime, we may have to come to the conclusion that it doesn’t really make sense for the ECB to keep putting €100 billion into Irish banks. What we are doing is actually illegal, but we have being doing it because we want to help Ireland. Maybe we might come to the conclusion that we should stop,” said the ECB source.
Given the vulnerability of the funding situation facing Irish banks, this reaction from the ECB to the Minister’s comments is unhelpful in the extreme, yet quite predictable.