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European Central Bank president says governments must save themselves

BERLIN — European Central Bank president Mario Draghi says there's "no external savior" for heavily indebted governments in the 17-nation eurozone and gave no indication the bank is ready to step in and support their finances.

Investors had hoped the ECB would increase its support for financially weak countries like Italy with bigger purchases of their government bonds once European leaders had agreed to tighten controls of national budgets.

So far, the ECB has made some purchases but kept them limited, stressing that governments must not rely on such help.

Draghi said governments had reached a "breakthrough for clear fiscal rules" at last week's summit, where 26 of 27 EU leaders agreed to seek a treaty toughening the enforcement of rules against excessive national debt and deficits.

But he offered no support for the notion that the ECB might now increase its bond purchases. Instead, governments need to take the tough steps to balance budgets and reform economies to promote growth.

"I will never be tired of saying that the first response ought to emanate from the country," Draghi said Thursday at a speech in Berlin. "There is no external savior for a country that doesn't want to save itself."

European Central Bank president says governments must save themselves 12/15/11 [Last modified: Thursday, December 15, 2011 9:52pm]
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