The European Central Bank is unlikely to include Greek bonds in its asset-purchase program for the foreseeable future, a person familiar with the matter said, as European creditors aren’t prepared to offer substantially easier repayment terms on bailout loans to improve the nation’s debt outlook.
- Lack of clarity on debt relief won’t allow ECB bond buying
Finance ministers to discuss Greek debt burden this week
Euro-area finance ministers will meet in Luxembourg on June 15 to discuss debt-relief measures that the ECB has said are needed before it will consider purchasing Greek bonds.
An agreement among the ministers will likely allow the International Monetary Fund — whose participation in the rescue program is a requirement for many nations — to commit in principle to a conditional loan, said the person, who asked not to be named because the discussions are private. But the extent and wording of debt-relief commitments probably won’t convince the Governing Council of the ECB to buy Greek bonds.
And while the government of Prime Minister Alexis Tsipras is relying on quantitative easing to aid Greece’s return to the public debt market, the ECB won’t factor fiscal consequences into its policy-making decisions and excessive emphasis on QE inclusion would be misguided, according to the person.
An ECB spokesperson referred to recent comments by ECB Executive Board member Benoit Coeure and ECB President Mario Draghi on the institution’s approach toward inclusion of Greece in QE.
The ECB’s quantitative easing is scheduled to continue until December 2017, with economists saying purchases will be gradually tapered throughout 2018. This would leave little time for purchases of Greek bonds before the program’s end. (continue reading in Bloomberg)
PS When Greece will be eligible for QE, the QE will be over. hm…
The Eurogroup don’t want Greece to recover.
They need to keep Greece in a permanent state of austerity as a warning to other EU countries.
There’s no reason why the ECB shouldn’t be buying Greek bonds, they just don’t want to.
They want to drag this out for as long as possible. They don’t care about Greece or its people, the Eurogroup know exactly what they’re doing.
Well said Avocado. The Eurogroup, this ridiculous, non-existent (it has no formal constitution) body of the German admiration society, has a clear purpose to destroy the Greek economy and its people. Whoever cannot see this by now is either blind or serves other interests.
There is nothing that can come out of this wolves pack other than more suffering and more destruction. The problem is what we do about it and why we allow the Quislings run the country for the benefit of the 4th Reich.