ECB: Draghi, a slightly frustrated eurofighter

It was no surprise, but something must be deeply wrong with the Euro area if an ECB press conference deals almost exclusively with a small member country and not so much with monetary policy. Greek banks will get slightly more emergency liquidity. As expected, there were no new monetary policy signals. However, the introductory statement contains a new phrase stressing the ECB's readiness to act, should it become necessary.

Confident that a bailout for Greece will come, the ECB has raised the Emergency Liquidity Assistance (ELA) to Greek banks by EUR 900m to 90bn. It was expected that to happen, only once all national parliaments have agreed to start bailout talks. Now it happens a bit earlier, it doesn't really matter. The small increase in ELA leaves room for further steps once the bailout negotiations have started, notes Nordea Global.

Draghi stressed once again that politicians have to decide about Greece's future, not the ECB that continues to act under the assumption that Greece will remain a member of the Euro area. And also under the expectation that Greece will pay what is due to the ECB on Monday and overdue to the IMF. For Draghi, some form of debt relief for Greece is uncontroversial. Otherwise, he declined to comment on the recent summit agreement. One could see it in his face how frustrating it must be right now to be a central banker given the rifts between the member countries.

Looking forward, it is expected that, a bailout to see the light of day after several weeks of difficult negotiations. If the talks fail, it will not be due to the ECB. The medium-term outlook for Greece remains very uncertain, given - among other things - the implementation risks, says Nordea Global.