LONDON: The European Central Bank's record low interest rates are not being passed through in hard-hit parts of the euro zone, ECB Vice President Vitor Constancio said on Monday.
"At present market fragmentation is severely hampering the transmission of ECB monetary policy," Constancio said during a speech at London-based think-tank Chatham House.
"In some countries changes in our main interest rates are being passed through by banks but in others, because bank funding is tight, interest rates changes are being passed through hardly at all."
The ECB left interest rates at 0.75 percent on Thursday although some of the bank's members had called for a cut.
Constancio added that putting in place a system for repairing or winding down troubled banks in the euro zone was a matter of urgency.
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