• A divided ECB prepares to help southern Europe and avoid a new debt crisis

The message sent on Wednesday by the

European Central Bank (ECB)

did not produce the expected result on Thursday in the markets and, although the risk premiums of the countries of southern Europe -such as Spain or Italy- fell,

the return required of their debt rose again

to levels not seen for eight years.

Faced with this market reaction, countries such as

Germany, Austria or the Netherlands

reminded their southern neighbors of the importance of

cutting their debt and deficit levels

if they want to avoid a debt crisis.

"Put your accounts in order, that's the message,"

Austrian Finance Minister

Magnus Brunner

spoke loud and clear upon arrival at the


meeting in Luxembourg, in which the ECB president herself, Christine Lagarde, participated. .

"We are all together in Europe to get our budgets in shape, because the ECB has to have more chances and the ECB can only have chances

if the budgets of all member states are in good shape

," she added.

He thus addressed the

most indebted countries and those with the highest public deficits

in Europe, which are precisely those that have been suffering in the last week an increase in the yield required for their bonds (which is always proportional to the risk of the issuer) and a tightening of its

risk premium

(an indicator that measures the difference between the return on a ten-year bond from any country and its German counterpart, the bund, understood as a risk-free asset).

Among them is


, which has a

public debt over GDP of 117.7%

at the end of the first quarter and a public


at the end of 2021 of

6.7% of GDP

, and whose ten-year bond offers a return of

2, 8%

, the highest since May 2014. Its

risk premium

, however, fell this Thursday to

117.8 basis points

because the yield on the German bond also rose -5% to 1.72%-.

The German finance minister,

Christian Lindner,

agreed with the Austrian and claimed that, although the ECB has the "responsibility to fight inflation",

the responsibility of governments

, "including the German one", is "

to reduce budget deficits

and return to a

reliable path of debt reduction"

to "safeguard market confidence and fiscal stability".

He thus asked the less orthodox countries in fiscal terms to

clean up their public finances

, since only in this way will they be able to offer

confidence to private investors

who have to buy their debt now that the ECB has stopped doing so.

A message that he has reiterated on several occasions and that he also recently conveyed in an interview with EL MUNDO.

Still, he wanted to send a message of



"We are seeing some increase in risk premiums among member states, but

there is no need for any concern

. In a long-term perspective, if you compare interest rates and premiums today with those of a few months or years ago , there is no need for anyone to get nervous," he said.

In our country, institutions such as the

Bank of Spain

or the Independent Authority for Fiscal Responsibility (


) have been asking the Government and, specifically, the Ministry of Finance, for more than a year to present a

medium-term fiscal consolidation plan

to explain the market and the rest of European countries what strategy the country has to reduce the budget gap when the pandemic ends.


the Ministry has always maintained that it was not the time

to do so given that the fiscal rules of the European Union are not activated.

The Netherlands,

another of the countries that has traditionally been a 'hawk', that is, a supporter of a more restrictive monetary policy to keep inflation at bay and a defender of budgetary orthodoxy, also spoke on the same line this Thursday.

His finance minister,

Sigrid Kaag

, said "these are not easy times" and that

fiscal stability

and fighting inflation are of crucial importance.

His Belgian



Vincent Van Peteghem

, agreed in stressing that "in the medium term

the evolution of public debt has to be sustainable

" and that "

fiscal policy also has to come into play

" to accompany the ECB's monetary measures against inflation.

He also recalled that the European Union already has clear rules regarding budget rules despite the fact that the Stability and Growth Pact is suspended.

It refers to the restriction of keeping the budget




and making policies so that the public


converges below


, regulations that will be reviewed before they are activated again.

The announcements by all these countries show what the position of the representative of their central bank will be in the

discussions that take place in the Governing Council of

the ECB to define a new anti-fragmentation instrument.

On Wednesday, this body ordered the institution's technical services to speed up the design of this instrument, but

its final approval must be agreed upon

by the Council in which all countries are represented.

As this medium has told,

conditionality will be key

, since the countries that keep their accounts in order, as the Austrian minister said, will demand that those in the south do the same to try to contain the profitability of their debt and their risk premiums.

If they achieved that budgetary rigor, it would not be necessary for the ECB to buy bonds from only some countries in a discriminatory way.

From the central bank, their spokesmen have tried to reinforce their message to penetrate the market.

"We are fully committed to quickly developing, designing and applying an instrument to deal with unjustified fragmentation," its vice president,

Luis de Guindos

, stressed yesterday, pointing out that it is necessary to prevent "a family or a company, in Italy or Spain , with the same liquidity conditions, pay more for a loan than a family or a company that asks for the same thing in Germany".

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