|
|
The letter was sent to Parliament by Dutch Finance Minister Jan Kees de Jager.
The European Commission has been pushing for the creation of eurozone bonds, and in November it made some concrete proposals. Some countries, including Italy, have said the bonds could have an important role in strengthening the euro because they could reduce borrowing costs for weaker nations and help make Europe's government bond markets more liquid.
But the currency bloc's stronger countries, like Germany and the Netherlands, remain staunchly opposed. Many investors have flocked to German and Dutch government bonds as they seek a haven for their money. This has helped reduce these countries' borrowing costs sharply.
In the letter, the four countries said there is no evidence behind the assumption that eurozone bonds would create a larger and more liquid market. Instead, they said, investors might shy away from them because of the high debt levels in the eurozone as a whole. This could hurt those countries still being perceived as safe havens, they said.
Full article (WSJ subscription required)