ECB calls on Croatia, Bulgaria to do more before joining euro

epa04383668 (FILE) A file photo dated 07 August 2014 showing a over-sized barbed wire, part of an installation, seen in front of the European Central Bank (ECB) in Frankfurt Main, Germany. The European Central Bank (ECB) announced surprise interest rates cuts on 04 September 2014 as it steps up its efforts to spur economic growth in the eurozone and to fight the threat of deflation. The Frankfurt-based ECB said it had trimmed its benchmark refinancing rate for the second time in three months, lowering to a historic low of 0.05 per cent. The bank also lowered its deposit rate, which is the rate charged for banks depositing funds at the ECB, deeper into negative territory, cutting it by 10 basis points to minus 0.2 per cent. The move sent the euro down to 1.3 dollars, while shares climbed on markets across Europe. EPA/BORIS ROESSLER

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Bulgaria and Croatia still have work to do in fixing their economies and improving their institutions before joining the euro, European Central Bank board member Fabio Panetta said today.

The reforms undertaken by the two will not fix all the imbalances and vulnerabilities they are facing, and more progress is needed to improve governance, their legal framework, and the overall quality of institutions, Panetta said in speech.

The two nations were admitted to the ERM-2 mechanism on Friday, a waiting room to enter the euro, and could join the currency union as soon as 2023.

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