Riksbank offers negative outlook on eurozone

Riksbank offers negative outlook on eurozone
Executives from Sweden's central bank, the Riksbank, gave a dire outlook for the eurozone, saying that political leaders have yet to present any credible solutions for the crisis, minutes of the central bankers' meeting showed Tuesday.

“All the members (of the central bank’s committee) found that the situation in the eurozone is still uncertain and that the crisis there will last,” minutes of Thursday’s monetary policy meeting said.

In the minutes, Governor Stefan Ingves said that “we can forecast that the uncertainty will last as long as credible measures have not been implemented.”

Deputy governor Lars Svensson gave an even darker assessment of the situation, saying that “the chances of resolving the euro crisis in a satisfactory manner still seem to be low.”

He added that he did not exclude a “disastrous end”.

Another deputy Karolina Ekholm meanwhile said that the eurozone remained embroiled in a public debt crisis and suffered from a lack of competitivity, with banks that are poorly capitalised.

“There is still no clear message from political leaders on the manner in which they will resolve these problems, although we are not expecting them to either,” she said.

The Swedish central bank had cut its interest rate by a quarter point to 1.25 percent following the meeting on Thursday. Five members of the committee had backed the rate cut while one sought a half percentage point reduction.

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