Draghi Says ECB to Do Whatever Needed as Yields Threaten

International Monetary Fund's Managing Director Dominique Strauss-Kahn (L) talks with , European Central Bank President Jean-Claude Trichet (C) and Italy's Governor Mario Draghi (R) prior to the start of their G-7 meeting at the Istanbul Congress Center (Photo credit: Wikipedia)

European Central Bank President Mario Draghi signaled that officials are prepared to do whatever

is needed to preserve the euro and act on surging bond yields that are tearing at the seams of the 17-nation currency bloc. “To the extent that the size of these sovereign premia hamper the functioning of the monetary policy transmission channel, they come within our mandate,” Draghi said during a speech in London today. “We have to cope with the financial fragmentation, address these issues.” “Within our mandate, the ECB is ready to do whatever it takes to preserve the euro,” Draghi said. “And believe me, it will be enough.” The comments come as Spanish policy makers call on the ECB to do more to fight a renewed bout of financial turmoil that pushed the yields on the country’s bonds to euro-era records this week. Spanish bonds rose after Draghi’s remarks. The yield on the 10-year bond, which touched a record 7.69 percent on July 22, fell 14 basis points. It was at 7.24 percent at 12:27 p.m. in Madrid. ... Continue to read.

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