Fear undermining Europe's money markets
Updated on 06 September 2007
Fear and a loss of confidence are undermining Europe's money markets, according to the head of the European Central Bank.
More money pumped in
€42bn was pumped into the crisis-ridden world financial system this morning by the European Central Bank President, Jean Claude Trichet. That makes it €150bn in less than a month.
At the same time, America's Federal Reserve has pumped billions into the US financial system, in its biggest intervention to stabilise the markets for a month. Here in the UK, the Bank of England left interest rates on hold.
Money not the solution
But those huge sums haven't solved the problem.
So today in a stinging rebuke, Trichet, the second most important person in world finance told the big banks and hedge funds to come clean about billions of pounds of suspected losses, blaming uncertainty about the scale of bad debts that have been building up.
