To manage some of the cyclical drivers of financial instability we have increasingly deployed a range of ‘macroprudential’ tools. Since the onset of the pandemic we have removed and then reinstated one of our key prudential settings.
The announcement of the involvement of private investors in the restructuring of the Greek debt in the summer of 2011 made financial markets fully aware of the implications of the prohibition to intervene to rescue member states under the Treaty on the Functioning of the European Union.