This is evident in the fact that central banks initially reacted through the injection of liquidity, including through special facilities and the expansion of list of eligible collateral. Discussions involving central bankers in various fora indicate their willingness to consider other courses of action in favour of protecting growth.
In 2010, the public budget deficit was above 11% of GDP and gross public debt was around 96% of GDP – of which, more than half was external debt. With potential output growing very slowly, rising external indebtedness fuelled investors’ doubts about the country’s ability to service its debt.