Mario Draghi announced a bond purchase project on Thursday, which will include Greek and Cypriot bonds. This verifies the rumors that had circulated in the previous days.
As he said during the ECB’s governing council meeting “we will buy Greek and Cypriot bonds with a series of measures to offset the inherent risk”.
Announcing the project’s schedule, the Italian central banker said that the Asset-Backed Security (ABS) purchases will begin in the fourth quarter of 2014, while purchase of covered bonds (Covered bonds are debt securities backed by cash flows from mortgages or public sector loans), will begin in the middle of October.
These programs, with a duration of two years, will help in financial the real economy, according to Mr. Draghi, adding that the impact of the programs will be important for the ECB balance sheet.
At the same time he stated that there is a unanimous decision by the ECB Board of Directors to take further measures if the current ones prove insufficient.
On the matter of inflation, he estimated that it will remain low, until 2015 and 2016 when it will slowly begin to rise again.
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