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ECB 'has stepped up its fight to support eurozone'

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The European Central Bank's (ECB's) latest announcement demonstrates its commitment to protecting the eurozone, experts have stated.

Last week, the institution announced its intention to set up a bond buying programme in order to help tackle the continuing debt crisis in the financial bloc.

Mario Draghi, president of the ECB, believes this will act as a "fully effective backstop to avoid destructive scenarios with potentially severe challenges for price stability in the euro area".

Responding to the news, Skandia said it suggests the ECB has "stepped up its fight to support the eurozone".

This, it stated, is likely to boost the confidence of financial advisers in the UK who believe more bailouts will be needed in Europe in the future.

Rupert Watson, Skandia's head of asset allocation, commented: "Spain clearly remains in focus, although Greece, Ireland and Portugal will probably also need further official support."

He noted that Europe's peripheral economies are either in or close to recession at the moment and are likely to remain in this state for some time to come.

This, he stated, means the actions of the ECB are "highly significant" and could help to bring about a "process of healing" for the worldwide economy.

Immediately prior to the ECB's announcement, Skandia had carried out a study to see which countries financial advisers in the UK believe are most likely to need a bailout.

Some 48 per cent of respondents said they think Spain is at the greatest risk of requiring financial support, while 18.5 per cent raised concerns over Italy.

Meanwhile, 9.9 per cent flagged up Portugal, while Greece and Cyprus were identified by 5.3 per cent and 3.3 per cent of respondents respectively.

Mr Watson added that since many financial advisers anticipate further bailouts, the announcement from the ECB will come as "no surprise".

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