Yesterday, the Bank of Latvia issued a press release warning of "another wave of distrust" in the Latvian economy. The Nation’s central bank blamed sagging confidence on "the many less than clear signals associated with the process of adopting the state budget and the called for legal amendments that would limit the liability of borrower toward lender to the value of collateral." The bank urged adoption of a budget, but suggested passage of the legal amendments be postponed, calling the present time "the most inappropriate moment possible." The amendments would "diminish in the Latvian financial sector and Latvia's chances for restoring its economic health."
Latvia, which has received over €7.5 billion in aid from the EU and IMF, has been one of several countries under pressure from the Council of the European Union to lower its debt to GDP ratio below the EU’s three-percent threshold.