FRANKFURT--The president of the German central bank, Jens Weidmann, on Sunday rejected calls for a debt cut and an end to austerity in Greece after the left-leaning Syriza party led in exit polls. It is clear that Greece will remain dependant on support and its also clear that this aid will be provided only when it is in an aid program, the Bundesbank president said in an interview with broadcaster ARD. Greece has agreed to cut public spending and raise taxes in exchange for loans from the European Union and the International Monetary Fund. But Syriza wants to renegotiate the terms and opposes austerity measures. Mr. Weidmann also rejected Syrizas calls for debt relief, saying Greece has already enjoyed a debt cut from private creditors and public lenders have eased their terms. As long as Greeces public finances arent sustainable, a debt relief would only give a short breather, he said. Mr. Weidmann, who is also a member of the European Central Banks governing council, criticized the ECBs decision on Thursday to buy more than a 1 trillion euros ($1.12 trillion) of assets to boost inflation. The Bundesbank chief said he doesnt see self-perpetuating price declines. The recent slowdown of inflation was mainly caused by adjustment processes in the crisis countries and the declining oil prices. With the bond-buying program, the ECB has now shot most of its bolt, Mr. Weidmann said. Write to Frankfurt bureau at djnews.frankfurt@dowjones
Posted on: Mon, 26 Jan 2015 08:36:34 +0000
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