The European Central Bank has given its starkest warning to date on growing strains in the eurozone credit markets, reports The Telegraph .
It said it is expecting fresh bank writedowns to hit $283bn (£173bn) by the end of next year. "Policy-makers and market participants will have to be especially alert in the period ahead. The credit cycle has not yet reached a trough," said the ECB's Financial Stability Report. "The deterioration in the macro-financial environment has continued to test the shock-absorption capacity of the euro-area financial system. Prospects for a significant turnaround in the short term are not promising," it said. Full story...
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