Draghi says Eurozone debtors cannot avoid painful austerity

Ben Southwood
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THERE is no alternative to fiscal consolidation, European Central Bank boss Mario Draghi said yesterday in a speech to the European Parliament.

“It is without doubt that the process of fiscal consolidation in the short term will depress,” Draghi said. “But what’s the alternative?”

Draghi went on to describe deficit and debt levels and “unsustainable”, but said the ECB couldn’t undertake monetary financing. He repeated that no limits would be set on the potential size of the Outright Monetary Transactions rescue scheme.

But Draghi admitted that even with the scheme, the Eurozone suffered from a crisis of confidence.