21 Dec 2011

European bank boss says euro can survive

5:29 am on 21 December 2011

European Central Bank president Mario Draghi says he's sure the about the euro's ability to survive the current crisis.

After media reports that suggested doubt was starting to creep in, Mr Draghi told the European Parliament's Committee on Economic and Monetary Affairs that he has no doubt of the currency's permanence.

Many analysts believe the bank should print more money to help government's repay debt, but Mr Draghi says the bank's primary task is to guard price stability.

Meanwhile, the bank warned that risks to the eurozone's stability have increased, the BBC reports.

In its twice-yearly Financial Stability Report it says that, in the worst case, there could be a return to a global recession.

It added the risk of two large banks defaulting within the next year had risen to the highest level in four years.

The ECB warned that some eurozone banks had become addicted to central bank funds and could face significant challenges.