What is the position of the ECB of Christine Lagarde on the sovereign debts of the euro area, which have increased so much with the fiscal stimuli launched by governments to stem the effects of the Covid-19 pandemic?
In the press conference following the European Central Bank’s rate announcement, Lagarde answered a question about Eurozone public debt, stating that it is true that “(government bond) rates have risen”, but that it is equally true that “the spreads did not rise at the same pace”.
Lagarde added that, should there be a flare-up of spreads, the ECB “would still have all the tools to intervene”.
Today the ECB confirmed the main Eurozone rate at zero, the deposit rate at -0.50% and the marginal loan rate at 0.25%.
The ECB also confirmed that the pace of asset purchases it made through the PEPP, or even pandemic QE, will end at the end of March.
In the first quarter of 2022, the Governing Council of the ECB will conduct net asset purchases under the pandemic emergency purchase program (PEPP) at a slower pace than in the previous quarter, before ending the program at the end of March.