–Hints ECB May Discuss Bond Buying Option At Mid-Month Meeting

VIENNA (MNI) – There is no pressing need for another long-term
refinancing operation by the European Central Bank, though one cannot be
ruled out, ECB Governing Council member Ewald Nowotny said Monday
evening.

“We can never exclude anything, but I do not see an immediate need
for a similar step,” Nowotny said when asked whether the ECB might
consider repeating the three-year LTROs in December and February that
pumped E1 trillion of liquidity into the Eurozone banking system. “One
has to distinguish between short and medium-term effects, but of course
it is quite obvious that this is a macro measure which does not have the
same effect on all countries affected,” he added.

Nowotny’s comments came during a panel discussion on the impact of
the Eurozone crisis on the economy of the Czech Republic. The Czech
central bank president, Miroslav Singer, also participated.

Nowotny appeared to suggest that the ECB might discuss the idea of
reopening its bond purchase program (SMP) at its mid-month meeting later
this week.

Asked when the ECB might start buying bonds again in the face of
growing pressure on Spanish and Italian sovereign yields, he replied:
“There is a meeting of the Governing Council on Wednesday and Thursday
this week, so it is not a good idea to discuss details today.”

He added: “I do not think that this is an operation you should
repeat in short intervals, but you should always check the demand.”

[TOPICS: M$$EC$,M$X$$$,MGX$$$,M$$CR$,MT$$$$]