by: David Milliken & Marius Zaharia
July 27, 2012
[Reuters] – European Central Bank President Mario Draghi pledged on Thursday to do whatever was necessary to protect the euro zone from collapse, sending a strong signal that inflated Spanish and Italian borrowing costs were in his sights.
Fears about the euro zone’s future are intensifying with Spain and Italy facing frenzied pressure on financial markets and Greece holding crunch meetings with its international lenders having failed to keep its repair plans on track, raising fresh questions about its place in the currency bloc.
With the need for urgent action becoming increasingly apparent, the ECB appears to be gearing up to flex its muscles, something Madrid and Rome have been seeking for months.
“Within our mandate, the ECB is ready to do whatever it takes to preserve the euro. And believe me, it will be enough,” Draghi told an investment conference in London to mark the beginning of the Olympics.