World Bulletin/News Desk
The euro zone is not in danger of breaking up despite some analysts' worse case scenarios, European Central Bank President Mario Draghi said, judging that the bloc was inevitably marching towards closer union among its members.
Asked in an interview with French newspaper Le Monde if the euro were in danger, Draghi said: "No, absolutely not. We see analysts imagining the scenario of a euro zone blow-up."
"They don't recognise the political capital that our leaders have invested in this union and Europeans' support. The euro is irreversible," he added.
In the long term, the euro would need to rest on a foundation of greater integration among euro zone countries, Draghi said.
"All movement towards financial, budgetary and political union is for me inevitable and will lead to the creation of new supranational bodies," he said.
European leaders took a step towards greater integration last month at a Brussels summit where they agreed to put the ECB in charge of supervising banks and gave the ESM rescue fund the power to recapitalise troubled banks.
However, the summit provided only brief relief to investors. Concerns about Spain have returned to the fore, driving the country's 10-year bond yields above the 7-percent danger level on Friday.
European and U.S stocks also fell and the euro hit record lows against the Australian, Canadian and New Zealand currencies in the face of increasing investor fears that the Spanish government may seek a full-blown bailout.
Draghi poured cold water on the prospect that the ECB could take action to calm the situation, saying that its mandate did not allow the central bank to resolve states' financial problems.
The International Monetary Fund has urged the ECB, which is legally forbidden from financing governments, to play a greater role fighting the crisis, suggesting that it could be given lender-of-last-resort functions.
At the summit in June, EU leaders broadened the ECB's role to include supervising banks in hope that the move would cut the risk that troubled lenders' problems could spread to sovereign borrowers.
Draghi said that the ECB's monetary policy and bank supervisory activities would have to be kept separate in order to avoid conflicts of interest and suggested that an "independent structure" could be built.
Weighing in on the LIBOR rate fixing scandal, he warned that it was undermining confidence in a cornerstone of the global financial system.
Turning to the economic outlook in the euro zone, Draghi said he did not see the risk that the bloc as a whole would enter a recession and that the situation would gradually improve towards the end of the year and the beginning of 2013.
The ECB cut its interest rates to a record low earlier this month to breathe life into the ailing euro zone economy amid signs that inflation pressures were subsiding.
Draghi said that the ECB, which strives to keep euro zone inflation at a rate close to but less than 2 percent, was prepared to take action in the case that the risk of deflation emerged.
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Turkey deems Iranian gas too expensive compared with other suppliers like Russia and Azerbaijan, an assertion rejected by Tehran.
Satoshi Nakamoto, a name known to legions of bitcoin traders, practitioners and boosters around the world, appeared to lose his anonymity on Thursday after Newsweek published a story that said he lived in Temple City, California, just east of Los Angeles.
BP's exploration and production sharing agreement with Libya covers onshore acreage in Ghadames, near the border between Libya, Algeria and Tunisia, and offshore acreage in the central Sirte basin
There are discussions at high levels within the U.S. government on how to use U.S. natural gas resources
The judicial sources said on Thursday that prosecutors suspected the companies of working together on campaigns to favour Lucentis, including promoting it to local doctors
Scotland's Energy Minister Fergus Ewing offered to meet Shell to discuss the future of the oil and gas industry if Scotland votes to end its 307-year tie with England
European Commission President said that from a purely financial standpoint the crisis in Ukraine should not have much impact on the euro zone but there was potential for far greater instability
The rouble-traded MICEX lost 1.9 percent on the news to trade at 1,322.2 points. It had earlier traded in positive territory.
If tensions eventually escalate into economic sanctions, the single biggest point of vulnerability for the Gulf would probably be the Dolphin Energy pipeline carrying about 2 billion cubic feet of gas per day from Qatar to the UAE and Oman
The former Soviet republic is strategically important to Moscow as the main gas transit route to the European Union, Russia's biggest customer
Iran will soon receive a second installment of previously frozen assets which are being returned to it under an interim nuclear agreement with world powers
Economic growth jumped to 5.2 percent in the last quarter, but Romania remains the second poorest country in the European Union
Brent crude prices decreased by 1.8 percent, more than US$2 per barrel on Wednesday.
The southeast European country sets out to achieve price stability by increasing the share of private entities in its state dominated energy sector.
Premier Li Keqiang also said at the start of the China's annual parliamentary session, that the country's 2014 growth target will be kept at 7.5 percent, inflation at 3.5 percent and broad M2 money supply growth at 13 percent.