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International Internet Magazine. Baltic States news & analytics Saturday, 20.04.2024, 01:12

Rimsevics: ECB's purchases of bonds may also boost lending in Latvia

BC, Riga, 23.01.2015.Print version
The European Central Bank will also purchase Latvia's bonds and, hopefully, part of the money pumped into the European economy will also reach Latvia and foster bank lending here, as the Bank of Latvia President Ilmars Rimsevics said in an interview with the Latvian State Television this morning, informs LETA.

The Bank of Latvia will be involved in the purchases of Latvia's bonds, and the ECB's far-reaching measures are intended to boost the economic activity, explained Rimsevics.

 

He said this would not lead to hyperinflation in Europe as the ECB would not flood Europe with money.

 

The value of the euro has been decreasing for six months, lending volumes and prices have been falling, and the euro area is faced with the prospect of lengthy deflation, Rinkevics explained. Although interest rates are low, no one seems to want to borrow.

 

The new move by the ECB will increase banks' lending opportunities, and this is hoped to boost economic activity, added Rinkevics.

 

The ECB announced on Thursday that it would buy EUR 60 billion of private and public sector bonds per month at least until the end of September 2016.





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