Marcel Fratzscher on today's decisions of ECB's governing council

The ECB has sent a strong signal of trust in the implementation of a third program by increasing its ELA support to Greek banks. The ECB underlines that it considers Greek banks fundamentally solvent. Mr. Draghi is optimistic that a bridge financing will be in place to cover Greek repayments to the ECB on 20 July.

The ECB decision is a continuation of its policy path and consistent with its decisions of the past few months. The ECB strictly excludes the possibility of a Grexit, thereby rejecting in particular some such calls in Germany.

The ECB support for debt relief for Greece is remarkably strong, thereby providing support for the IMF call to do so. This may receive criticism, in particular in Germany.