Brussels, 02/11/2011 (Agence Europe) - The interventions of the European Central Bank (ECB) on the bond market, which some critics feel are too timid, are failing to contain the increase in Italian borrowing rates, in the face of the latest drama playing out in Greece.
On Tuesday, these rates were considerably above 6%, a level which is difficult for Italy to sustain, even though, according to a number of brokers, the ECB was actively buying up Italian bonds on the secondary market.
In spring 2010, the ECB responded to the urgent call of the leaders of the eurozone and agreed to buy up public debt in order to slow down Greece's spiralling rates. However, it went on to drag its heels over continuing the programme, which was not relaunched until August of this year due to the risk of trouble spreading to Italy and Spain. In particular, it has constantly stressed that this programme is a temporary one and called for the European Financial Stability Fund (EFSF) to take over, which it will not be able to do for a few weeks. The Frankfurt-based monetary institute considers that it is not its job to rescue governments. Italy's Mario Draghi took over from Jean-Claude Trichet on Tuesday and will give his first press conference on Thursday, after the meeting of the Board of Governors of the ECB. (LC/transl.fl)