ECB says OMT was created to preserve singleness of monetary policy
The ECB Governing Council said Thursday it has taken note of Tuesday’s ruling of the European Court of Justice (ECJ) confirming that the central bank’s OMT asset purchase program is compatible with EU law and within the ECB’s competences. “The bond-buying program was created in order to preserve the singleness of monetary policy in the euro area and ensure the transmission of the ECB’s policy stance to the real economy,” the central bank said in a press release. The ECJ ruled Tuesday that the ECB must be allowed ‘broad discretion’ when it ‘prepares and implements an open market operations program’ as it needs ‘to make choices of a technical nature and undertake forecasts and complex assessments,’ the central bank pointed out in its statement.
Germany's Constitutional Court had referred the case to the ECJ at the start of last year. cep expert Bert Van Roosebeke told the Financial Times: “It’s a very clear defeat for the German court. On the point of whether this is an economic or monetary policy, the European court said it is monetary policy and so within the ECB’s mandate.”