According to Reuters the European Central Bank is thinking
the unthinkable to save the euro, including resuming its controversial
bond-buying program and possibly even pursuing quantitative easing — in effect
printing money. Bold action is probably
at least five weeks away, insiders say, though some more clues may come when
the ECB reveals its latest interest rate
decision on Thursday.
Several other pieces have to fall into place before the ECB
will act decisively, insiders say. These include a request for assistance from
Spain, which Madrid is still resisting, a decision by euro zone leaders to let
their bailout fund buy bonds at auction, and a German court ruling on the
legality of the euro zone's permanent rescue fund, due on Sept. 12. Above all, ECB President Mario Draghi must
overcome the resistance of Germany's powerful central bank, the guardian of
monetary orthodoxy, glowering from the other side of Frankfurt.
Draghi raised expectations last Thursday that the ECB would
resume buying sovereign bonds as Spanish and Italian borrowing costs vaulted
towards levels that could force the euro zone's third and fourth largest
economies out of the credit markets....
No comments:
Post a Comment