Greek debt crisis may fuel ‘grave tensions that could prove destabilizing’ – ECB’s Visco

FXStreet (Mumbai) - The European Central Bank (ECB) must continue its quantitative easing program to boost inflation in the 19-nation bloc even though the threat of deflation has recently weakened, central bank's governing council member Ignazio Visco said in a speech to the annual shareholder assembly of the Bank of Italy.

Key Quotes:

"Fears of deflation have abated but the positive effects of the program observed so far should not weaken our determination to take it forward,"

"There are no signs to date that low interest rates are provoking generalized imbalances,"

He also touched on the issue of the Greek debt crisis and said that its impact on sovereign risk premiums in the rest of the euro area has so far been limited. However, further destabilization may become a reality given that the ongoing discussions are shrouded in uncertainty, "fuelling grave tensions that could prove destabilizing."