Controversial ECB bond purchases: The way for the Bundesbank

The Federal government has informed the Federal constitutional court now also in writing, that according to their assessment, the European Central Bank (ECB) ha

Controversial ECB bond purchases: The way for the Bundesbank

The Federal government has informed the Federal constitutional court now also in writing, that according to their assessment, the European Central Bank (ECB) has met its targets. A spokesman for the German Finance Ministry confirmed on Friday a Letter from Olaf Scholz (SPD) to the highest court in the land.

Manfred Schäfers

economic correspondent in Berlin.

F. A. Z.

The Minister is supposed to represent the view that the decision of the governing Council shall be sufficient, in conjunction with the documentation provided to the requirements of the judgment of may this year.

According to the assessment made by the Federal Ministry of Finance, the governing Council's proportionality test is balancing to understand, the had calls the judges in red robes in. In particular, at the time of the respective decision-making expected fact would purchase effects of the bond program, PSPP on the finances of the member States, the banking sector, households, companies, as well as the Central banks in the Eurosystem is set out, and with his target, the inflation rate in the Eurozone in the medium term below, but close to, 2 percent increase, in relationship.

The Letter of Scholz is the provisional end of a lengthy process. It comes with its contents as little surprise after both the Federal government and the Bundestag came a few weeks ago to the same result. The General view is that there is now no reason why the Bundesbank after the expiry of the ultimatum of the Federal constitutional court, on 5. August not to continue the bond purchases by the Eurosystem should be involved. The Federal constitutional court has to deal only once with the thing, if the Complainant should request a so-called Enforcement order.

Updated Date: 31 July 2020, 14:20

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