The ECB has purchased soon and everything is empty?

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Monetary policy

The ECB has purchased soon and everything is empty?

The European Central Bank (ECB), could according to experts, in a few months, German government bonds for its controversial securities-purchase program. The ECB itself is silent.

Since the yields of German government bonds decline currently, are likely to soon be only a few German debt, the ECB meet the criteria. “Without Changes there will be, at the latest, in the fourth quarter, where the purchases of German government bonds will come from,” said Jamie Searle, from Citibank. Only those bonds with maturities from two to 30 years, the rate of return is lower than the current Deposit rate, fulfil the conditions for the ECB program.

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The investment Bank, Jeffreys has estimated that the custodians already in three months is no longer sufficient Federal bonds for the purchases. The Bank Danske according to which the ECB could encounter in October at borders. Calculations of the Swiss private Bank Pictet, according to the rate of return is now around 50 percent of all German government bonds under the current Deposit rate of minus 0.4 percent. This penalty fee must pay banks when they Park money overnight at the Central Bank.

Buying criteria soften?

In the case of your overall, to 1.74 trillion euros-scale securities purchase programme, the ECB support for the economy and Inflation will heat up, the largest share of government bonds. So far, it is planned that the transactions expire until the end of March 2017. Its regional breakdown is made according to the proportion of the respective Central banks in the equity of the ECB. Therefore, the Bundesbank buys, for example, significantly more titles than, for instance, the Portuguese Central Bank.

Some Central bankers are of the view that currently the criteria is not shaken. “I see no need for such Changes and I think there is a sufficient supply for the current program,” said ECB governing Council member recently. If it should be necessary, there will be Changes.

One of the put the buy limit of 33 percent depending on the bond Emission is screws. According to Pictet estimates, the Lifting of the upper limit to 50 percent would mean a further twelve months with a sufficient supply of government bonds. The ECB did not want to comment on the information.