FRANKFURT (MNI) – The Bundesbank is particularly opposed to
introducing yield caps for Eurozone peripheral states as part of any new
European Central Bank bond buy program, German daily Frankfurter
Allgemeine Zeitung reported Tuesday, citing a Bundesbank source.
There is no justification for cementing a particular yield spread,
the Bundesbank source told the paper.
German magazine Der Spiegel reported over the weekend that the ECB
might establish pre-determined yield thresholds to decide when to
intervene in sovereign bond markets. The ECB called the report
“misleading,” noting that no final decision had been made.
The Bundesbank is also pushing to limit the scope of the new bond
buy program, but does not appear to be able to secure a majority for its
view, the paper said.
On Monday, the German central bank reiterated its objections to
fresh debt market interventions.
“The Bundesbank maintains its view that government bond buys in
particular should be assessed critically and that they come with
significant risks for stability policies,” it said in its Monthly
Report.
–Frankfurt bureau; +49-69-720142; jtreeck@mni-news.com
[TOPICS: MGX$$$,MT$$$$,M$$CR$,M$X$$$,M$G$$$,M$F$$$,M$$EC$]
