"So intervening in bond markets, it is a very important temporary backstop to a wider strategy," he told Reuters. "If the ECB comes up with proposals that provide concrete content to the ideas about support of bond markets, that would be extremely important."
ECB president Mario Draghi was expected next week to unveil a new bond-buying programme to help the two struggling eurozone states go on without a formal bail-out. He appeared to have secured the authority to press ahead after winning the support of the German chancellor, Angela Merkel.
However analysts now expect the measures to fall short of Mr Draghi?s vow to do ?whatever it takes? after the German government had to persuade the influential Mr Weidmann to stay in his post. Stepping up the pressure, fellow German ECB policymaker J?rg Asmussen said the ECB should only buy bonds if the International Monetary Fund was involved in setting an economic reform programme in return.
Analysts expect Mr Weidmann to be outvoted on the ECB next week, but his threat to quit would put Ms Merkel, the region?s power-broker, in an awkward political position as the Bundesbank is revered in Germany.
?By being so outspoken beforehand, he hopes to limit the extent of the operation,? a senior ECB source told Reuters. ?That would constantly put a question mark over how far we could go.?
Berenberg Bank economist Holger Schmieding said: ?Opposition from Weidmann and reservations from some other council members will mean that ECB bond purchases could be highly conditional ... and not bring yields down quite as much as Italy and Spain might like to see.?
Adding to the sense of uncertainty, ECB officials on Friday night said governors would be presented with a list of options for bond purchases the day before they sit down to deliberate the plan. Economists said the process increased the chances of a decision being pushed back.
The crisis has grown so severe that Mr Draghi this week pulled out of the annual central bankers? gathering at Jackson Hole in the US to address the problem. Ms Merkel is also reported to have asked the Italian prime minister, Mario Monti, not to request aid until the Bundesbank issue is resolved. Mr Weidmann and the German authorities refused to comment on the reports of his threat on Friday.
David Lipton, the IMF?s deputy managing director, has backed Mr Draghi. ?He?s got the right idea, the right approach and he needs the conditions under which his action can be effective. He needs the countries of the periphery to be doing what they need to do and then he can act,? he told CNBC.
machine gun kelly saul alinsky annapolis trisomy wwe royal rumble leon panetta luck
No comments:
Post a Comment
Note: Only a member of this blog may post a comment.