New York, August 1 (alphajetsusa.com) – At the European Central Bank meeting, the United States pressurized euro zone to solve the debt crisis problem by taking decisive measures. The key step that can be taken to lessen the problem can be lowering the borrowed costs of the troubled members and the interest rates should be brought down in the reforming countries. The banks should be able to provide the credit according to the economies needs.
As the risk premium investors demand to hold the bonds, Italy and Spain have been at the risk to loose the access to the credit markets.
Last week, Draghi indicated that the Central Bank might take radical steps to preserve the Euro. According to US Treasury Secretary Timothy Geithner, he has discussed plans with Schaeuble and Draghi to solve the crisis, however, at the same time he made it clear that they won’t take any immediate action. Citing the example of past crisis he said that the longer time taken to solve the issue costs more.
The unemployment in euro zone has the touched the highest point. In June, additional 123,000 people have lost their jobs. The jobless rate has reached 11.2 percent.
Spain has come dangerously close to losing affordable access to financial markets. And if the Spain goes than the Italy is expected to follow its footsteps.