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Bank of Italy's Visco says is "very concerned" about uncertainty in Catalonia
November 6, 2017 / 3:52 PM / in 11 days

Bank of Italy's Visco says is "very concerned" about uncertainty in Catalonia

MADRID, Nov 6 (Reuters) - Bank of Italy Governor Ignazio Visco on Monday said that European institutions were very concerned about the economic implications of the political uncertainty in Catalonia.

“Certainly we are concerned of the economic implications,” he said, asked about the consequences of the crisis in Catalonia resulting from its regional government’s push for independence.

Catalonia’s former leader Carles Puigdemont was spared custody on Monday, when a Brussels court ruled he could remain at liberty in Belgium until it had heard Spanish allegations of rebellion against him.

Separately, on the issue of the European framework for the resolution of weak financial institutions, Visco said there may be circumstances where state aid is necessary.

He said the ECB would have to closely monitor price stability regarding future bond acquisitions.

The ECB is planning to cut its bond buys in half to 30 billion euros a month from January given robust growth, but it kept the option to raise or extend buys and promised to reinvest maturing funds for years to come.

Designed nearly three years ago, the bond buys worth more than 2 trillion euros depressed borrowing costs and lifted growth but failed to raise inflation to the ECB’s target of almost 2 percent.

Reporting By Jesús Aguado and Alba Asenjo; Editing by Angus Berwick

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