Credit crunch risks have not evaporated

Having agreed to forego profits on its Greek government bonds and pumped billions more into the banking system over the past month, the ECB is unlikely to announce any major policy changes at its Governing Council Meeting on 8th March. President Draghi will no doubt highlight the vital support that the ECB’s recent LTROs have provided to the banking sector. But he may warn again that the euro-zone economy still faces the risk of a major credit crunch.