Vladimír Urbánek (Kurzy.cz)
Markets  |  September 06, 2012 15:43:35

Draghi: ECB agrees to unlimited bond buying program

ECB chief Mario Draghi at a press conference accompanying today's decision by the central bank to set interest rates announced that central bankers have found the announced agreement on a program of unlimited purchases of government bonds in order to regain control over the revenues in the euro area and prevent further speculation about the possible collapse of the euro area .
According to Draghi program helps solve problems overreacting bond market, which are caused by unfounded fears of some investors about a possible loss of credibility of the single currency.
The plan will, according Graghiho follow strict rules, the application will stop the destructive scenarios and foster price stability of the eurozone.

The ECB reserves the right to terminate any support purchase of bonds if the country fails to comply with the agreed parameters healing process.

ECB will focus on bonds with maturities of 1 to 3 years, but does not exclude purchases of longer-term bonds. All purchases will be "sterilized", which means that the ECB would withdraw from circulation the same liquidity correspond to the volume purchases. The resulting effect on the state of the money supply will be neutral.

In response to the statement began to significantly decrease yields of Spanish and Italian government bonds.
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