pandemic coronavirus was amplified sources of financial vulnerability, and poses the threat of new attacks by causing the increase of debt and difficulties in the banking sector, believes the european central Bank on Tuesday.read more : Lagarde: ECB is ready to increase its bazooka anti-crisis
The cost of the crisis over the long term and some countries may encounter difficulties in repaying their debts, which would increase the risk of forced out of the euro zone, adds the ECB in its financial stability review.
It also mentions the risks related to the indebtedness of the companies, the banks ' low profitability and the possibility of a correction in real estate prices.
"Even if infection rates are declining in many countries, the impact on the economy and the markets has exposed and amplified existing vulnerabilities to the financial stability of the euro zone," she says.read also : The ultimatum of the German department of justice is undermining the anti-crisis action of the ECB
"If action at national or european level prove to be insufficient to maintain debt sustainability, the assessment by the market of the risk of redénomination could still increase," adds the ECB, in reference to the risk of a State to abandon the euro. In this case, the rise in yields on government debt could have an impact on the private sector and affect the banks.
The first risk to materialize would be that of a multiplication of the deterioration of credit ratings of firms, which would limit the access of the real economy to finance.
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