Bloomberg News

Praet Says ECB Will Have to Withdraw Liquidity ’Correctly’

February 27, 2012

Feb. 27 (Bloomberg) -- European Central Bank Executive Board member Peter Praet said the ECB will withdraw liquidity created by its refinancing tenders “when things normalize.”

“We have to do that correctly,” Praet said during an event in Berlin today. “We are very attentive to that.”

Praet said that while the ECB’s balance sheet has expanded through long-term refinancing operations, money supply to the real economy remains “very weak.”

“When things normalize there we will have to withdraw liquidity out of the system,” Praet said. “It’s a very delicate policy.”

To contact the reporter on this story: Jeff Black in Frankfurt at jblack25@bloomberg.net

To contact the editor responsible for this story: Brian Parkin at bparkin@bloomberg.net


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