Brussels, 26/11/2014 (Agence Europe) - In the course of the first quarter of 2015, the ECB will be able to determine whether it should start to buy back sovereign debt to support activity in the eurozone, its vice-president, Vítor Costâncio, announced on Wednesday 26 November.
“During the first quarter of next year”, we will be able to better gauge whether the pace of growth of the ECB's balance sheet is in line with expectations, Costâncio said in a speech in London at the FT Banking Summit. If this is not the case, he added, “we will have to consider buying other assets, including sovereign bonds in the secondary market, the bulkier and more liquid market of securities available. It would be a pure monetary policy decision (…), within our mandate and our legal competence”.
In order to tackle the inflation rate (0.4% in October) and relaunch growth in the eurozone, the ECB is acting to bring the size of its balance sheet back to its March 2012 level, or an increase of €1,000 billion. It has started to buy covered bond and asset-backed securities. (MB)