Der Spiegel: ECB refuses to buy Greek “junk” bonds

The European Central Bank tightens the clamp of fiscal liquidity

Despite the hopes cultivated in the last few weeks that the ECB’s program would include the purchase of Greek bonds, it has been proven otherwise, according to German magazine “Der Spiegel”, which states that Greek bonds -rated “Junk”- will not be bought by the European Central Bank during the program.

 

This means that despite the fact that the Bank of Greece (BoG) is a shareholder within the ECB, the latter refuses to buy Greek government bonds.

 

According to the German magazine, the program will limit the amount of bonds that a central bank can buy, to 20% or 25% of the country’s total debt.

 

According to updated information, ECB officials are considering giving local national banks the ability to only purchase their country’s bonds in order to avoid the danger of “transmitting the disease” to a country, through the bonds of another.

 

The final decisions and the beginning of the program will be announced by Mario Draghi on Thursday, two days before general elections take place in Greece.

 

 

As so far as Der Spiegel’s publication goes, ECB sources answered protothema.gr that the meeting  which will decide on all the above will take place next week. “Nothing is yet decided”, state sources from the ECB, on the subject of Der Spiegel’s report.