Fed Must Object To ECB Move On Greece, Senator Says

The Federal Reserve must object to a decision by the European Central Bank earlier this month to restrict liquidity to Greek banks, according to Sen. Bernie Sanders, an independent from Vermont who caucuses with Democrats. "The U.S. cannot stand idly by while the European Central Bank undermines the new democratically-elected government of Greece, induces deflation and risks financial instability," Sanders said in a letter to Fed Chairwoman Janet Yellen. Sanders asked Yellen "to make it clear to the leadership of the ECB that the United States and the Fed object to actions that affect our national interest." In a move seen as cranking up pressure on the new anti-austerity government to reach a debt deal with creditors, the ECB last week told Athens that Greek financial institutions can no longer use the country's sovereign debt as collateral for ECB-provided liquidity. Earlier this year, Sanders became the ranking minority member of the Senate Budget Committee.