(Corrects to say "than of" not "and of" in paragraph 6)
FRANKFURT Oct 9 The European Central Bank is
keeping a close eye on the development of market interest rates
and can step in if necessary, Executive Board member Joerg
"We are looking at money market rates, especially EONIA,
very closely," Asmussen said in an interview with CNBC that was
aired on Wednesday.
"We will keep this in mind and if necessary we can deal with
a number of instruments with the liquidity situation for the
banks," he said, adding that liquidity was "no substitute for
lack in capital".
Asmussen also said it was too early for the ECB to think
about exiting its loose monetary policy stance.
"We are in a different situation of the business cycle than
the U.S. is. So for us it is clearly too early to exit," he
"But when the point comes one has to be clear
communication-wise and I'm also very much convinced that exiting
is possible. For me it is more a question of political will than
of technical possibilities," he said.
Asked whether he saw a real risk of the United States
defaulting, he said: "To be honest I don't see this. We have
learned from our U.S. friends how to be pragmatic and I'm
convinced that they will find a solution before the critical
(Reporting by Eva Taylor; editing by Mike Collett-White)