14.01.15

ECJ advocate general gives green light for ECB's bond purchasing program

cep expert Van Roosebeke: One would have preferred clearly defined limits for government bond purchases

European Court of Justice in Luxembourg

The European Central Bank has the right to undertake its OMT government bond purchasing program as a monetary policy measure, the advocate general of the European Court of Justice (ECJ) said Wednesday. However, the ECB would not be allowed any longer to set the fiscal and reform requirements for euro crisis states, which then become a condition for the OMT program itself. cep expert Bert Van Roosebeke told Germany’s Handelsblatt: “We’re disappointed because the ECJ grants the ECB an almost absolute leeway.” He would have preferred clearly defined limits for government bond purchases. “The advocate general, for example, could have said that the ECB can only purchase a maximum of 20 percent of Italian bonds,” Van Roosebeke said.