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Article: Closing the dustbin lid; The European Central Bank.(The ECB gets tougher with banks)
- Article from:
- The Economist (US)
- Article date:
- August 30, 2008
CopyrightCOPYRIGHT 2008 Economist Newspaper Ltd. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan. All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)
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Banks will soon find it a bit harder to game the euro-zone's liquidity support
NO ONE could accuse the European Central Bank (ECB) of taking its lead from America. While policymakers there contemplate the salvation of Fannie Mae and Freddie Mac, the troubled government-sponsored mortgage firms, the ECB is set to tighten up its rules to ensure that what it offers to banks is strictly liquidity support, and nothing more. A change to the rules that govern its money-market operations could be agreed on by the bank at its next rate-setting meeting on September 3rd and 4th.
If so, it will mark a minor reversal in a global trend. As the credit crunch has ...