Home Business The Bond Market Needs Just One Thing from Lagarde

The Bond Market Needs Just One Thing from Lagarde

15
0



It is also most important to amend the APP’s limits so more than a third of any nation’s debt can be held under the stimulus programs (PEPP allows 50%). Otherwise, it might hamper the ECB’s ability to control the yield spreads between German bunds and those of peripheral nations. The lesson that euro area yields be kept low, but also not too far apart, was repeated early in 2020 when Lagarde opined “We are not here to close spreads” — which is exactly what they are there to do. The press and the markets reacted negatively to that remark. The ECB could create a preventative “spread reduction” facility to act on market turmoil. It would be much simpler, however, to amend its existing tools.

Previous articleGlenn Youngkin’s viral ‘child’ ad is missing important context
Next articleJulian Assange LIVE: Wikileaks chief faces US extradition TODAY – major decision in hours

LEAVE A REPLY

Please enter your comment!
Please enter your name here