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ECB Seen Favoring Bond Buying Over Bank Loans - Bloomberg

The European Central Bank will restart its controversial government bond purchases rather than offer banks another round of unlimited three-year loans as the sovereign debt crisis worsens, a survey of economists shows.

Of 22 economists polled this week, 17 predicted the ECB will be forced to resume the Securities Markets Program (ECBCSMP), while only one forecast it will offer another batch of three-year cash. Nine said the central bank may consider shorter maturity loans of one or two years.

"Market stresses will eventually force the ECB to restart the bond program, but it's not imminent," said Ken Wattret, chief euro-area economist at BNP Paribas in London, who participated in the survey conducted April 11-12. "Trying to get consensus on the council for it will be difficult."

by afew (afew(a in a circle)eurotrib_dot_com) on Sat Apr 14th, 2012 at 03:54:12 PM EST
[ Parent ]
It seems the economists surveyed assume that pragmatism (things that work) will trump politics (German opposition to bond buying.)

That may be true, but I'm not that hopeful.

by Metatone (metatone [a|t] gmail (dot) com) on Sun Apr 15th, 2012 at 04:55:28 AM EST
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