Euro zone interest rates are at a suitable level and the European Central Bank is getting ready to look into how to get extra liquidity out of the markets, ECB Governing Council member Erkki Liikanen said today.
"The rate level is currently suitable, right," Mr Liikanen said in an interview with Finnish television channel MTV3.
"In March (we) will discuss special actions, including pumping extra liquidity into markets, if that needs to started to be drawn off and the answer is yes."
"We have to do it that way that our rate position will not change, but that the extra liquidity which could start to bubble, we need to start pulling it away," he explained.
The ECB promised to lay out the next stage of its plans for a further pull-back of crisis measures when it meets next month, after it kept interest rates at a record low of 1.0 per cent yesterday.
But turmoil brewing in Greece could slow the ECB's withdrawal of its extra liquidity measures, especially if other countries become infected with similar problems.
When asked about concerns over Greece's debt levels, he said that each country was responsible for its own public finances, but added that if financial markets lost faith it was costly to a country to take care of its debt.
"The market is closely watching each country's ability to pay its debts. If the faith is lost, rates will go up significantly," Mr Liikanen said.
Reuters