ECB welcomes ‘positive’ economic developments in Greece in 2019

ECB welcomes ‘positive’ economic developments in Greece in 2019

The European Central Bank said it “very much welcomes the positive economic and financial developments” observed in Greece in the course of 2019.

The central bank said there had been positive developments in the Greek real economy and financial markets for some time before the outbreak of the coronavirus.

The comment was provided as part of the central bank’s feedback on the input provided by the European Parliament after the submission of the ECB Annual Report 2019 to the plenum.

Commenting on the eligibility of Greek bonds, the ECB said it is subject to a decision by the governing council based on a number of considerations, including risk management.

“Although Greek public sector securities have so far not been purchased under the public sector purchase programme (PSPP), the ECB’s accommodative monetary policy has contributed substantially to easing financial conditions in Greece, as shown by the low bank lending rates to Greek households and non-financial corporations,” the bank says in its comment.

Moreover, marketable debt securities issued by the Greek government are eligible, under a waiver, for the PEPP, it said.

According to the feedback, the waiver was granted "in the light of both the market turbulences experienced in the context of the coronavirus emergency and the fact that an enhanced surveillance process is currently in place for Greece.”

The bank said 22 Greek sovereign debt instruments are temporarily accepted as collateral in Eurosystem credit operations under a waiver.

The feedback provided focuses primarily on the ECB’s activities in 2019 and was made public in line with the practice adopted in 2016 in response to a request from the European Parliament, the bank said.

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