The European Central Bank (ECB) had no plans to announce at its Thursday meeting that it would launch any additional bond-buying measures or take any other action to combat the debt crisis in the euro zone, holding steady against calls for more action.
Reuters reported Thursday that despite calls in financial markets for the central bank to boost its crisis-fighting measures by buying Spanish sovereign bonds, policymakers at the ECB had no such plans as they prepared for the meeting in Barcelona.
It was expected that demonstrators would be protesting the country’s austerity measures outside the meeting, but officials were considered more likely to praise Spain’s efforts to cut its deficit than to announce any policy action such as a restart of the ECB’s Securities Markets Program (SMP).
Despite increases in Spanish bond yields to 6%, for the last 7 weeks the ECB has let its bond program lapse. Should yields rise to 7%, that is considered unsustainable and could possibly trigger some sort of action. However, Germany’s Bundesbank has resisted any move by the ECB to cut interest rates or restart its bond-buying program, and it is unlikely the central bank will go against that position.