Senior Economics Correspondent, Germany
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Jan 31, 2015

Germany, ECB play hard ball with Greece

BERLIN/HELSINKI (Reuters) – German Chancellor Angela Merkel ruled out a debt writedown for Greece on Saturday, and a European Central Bank policymaker threatened to cut off funding to Greek banks if Athens does not agree to renew its bailout package.

The euro zone’s paymaster and the ECB are both taking a tough line with Greece’s new leftist government, whose leader swept to victory last Sunday promising that five years of austerity, “humiliation and suffering” were over.

Jan 23, 2015

ECB’s trillion-euro move offers short-term boost, but at a cost

FRANKFURT, Jan 23 (Reuters) – ECB chief Mario Draghi’s 1
trillion euros of fresh money could prove the masterstroke that
saves the euro zone for now, but it breaks the principle that
the bloc acts as one, a move that could ultimately undermine the
currency he is trying to save.

In monthly 60 billion-euro instalments from March, the
European Central Bank will buy chiefly government debt at least
until September of next year, or as long as is needed to revive
inflation, which recently swung into reverse.

Jan 22, 2015

ECB launches last-ditch programme to revive euro economy

FRANKFURT (Reuters) – The European Central Bank took the ultimate policy leap on Thursday, launching a government bond-buying programme which will pump hundreds of billions of new money into a sagging euro zone economy.

The ECB said it would buy government bonds from this March until the end of September 2016 despite opposition from Germany’s Bundesbank and concerns in Berlin that it could allow spendthrift countries to slacken economic reforms.

Jan 22, 2015

ECB to decide on bond-buying plan to revive euro zone

FRANKFURT, Jan 22 (Reuters) – The European Central Bank is
poised to announce a plan on Thursday to buy government bonds,
resorting to its last big policy option for breathing life into
the flagging euro zone economy.

Market expectations are sky-high for the ECB to unveil
large-scale quantitative easing (QE) – printing money to buy
government bonds – despite opposition from Germany’s Bundesbank
and concerns in Berlin that this could allow spendthrift
countries to slacken economic reforms.

Jan 21, 2015

ECB to decide on bond-buying plan for reviving euro zone economy

FRANKFURT (Reuters) – The European Central Bank is poised to announce a plan on Thursday to buy government bonds, resorting to its last big policy tool for breathing life into the flagging euro zone economy and fending off deflation.

Market expectations are sky-high for the ECB to unveil a large-scale program of quantitative easing (QE) – printing money to purchase the sovereign bonds – despite opposition from Germany’s Bundesbank and concerns in Berlin that this could allow spendthrift countries to slacken their economic reforms.

Jan 21, 2015

ECB set to decide on money printing plan

FRANKFURT (Reuters) – The European Central Bank’s Executive Board has proposed a program that would enable the ECB to buy 50 billion euros ($58 billion) in bonds per month starting in March, a euro zone source said on Wednesday.

With the likely start date imminent and only one other opportunity at the beginning of March for governors to agree details, pressure will be high on them to finalize talks and announce the mechanics on Thursday.

Jan 21, 2015

ECB Executive Board proposes 50 billion euros in monthly bond buys: source

FRANKFURT (Reuters) – The European Central Bank’s Executive Board has proposed a program that would see the ECB buy 50 billion euros ($58 billion) in bonds per month starting in March, a euro zone source said on Wednesday.

Reuters could not confirm reports from other media about the duration of the proposed program. The Wall Street Journal said it would last at least one year. News agency Bloomberg said the purchases would run to the end of 2016.

Jan 20, 2015

Demand for home loans jumps in euro zone

FRANKFURT (Reuters) – One in four banks across the euro zone saw a rise in home loan demand toward the end of last year and almost as many expect the trend to continue, a survey by the European Central Bank showed on Tuesday.

As consumers bet on rising house prices and banks loosen lending standards, demand for home loans has shot up, the study found, a trend that will fuel concerns in Germany and elsewhere that cheap money could be blowing up a property bubble.

Jan 16, 2015

Unwinding crisis loans add to pressure for ECB bond buying

FRANKFURT (Reuters) – A fresh repayment of crisis loans next week will have a tightening effect on the European Central Bank’s policy stance, bolstering the case for it to deliver a broad bond-buying plan at a crunch Jan. 22 meeting.

The repayments have a shrinking effect on the ECB’s balance sheet – just the opposite of what the central bank wants to achieve – and leave it swimming against the tide of its own past policy measures as they unwind.

Dec 19, 2014

ECB considers making weaker euro zone states bear more QE risk -sources

FRANKFURT, Dec 19 (Reuters) – European Central Bank
officials are considering ways to ensure weak countries that
stand to gain most from a fresh round of money printing bear
more of the risk and cost.

Officials, who spoke on condition of anonymity, have told
Reuters that the ECB could require central banks in countries
such as Greece or Portugal to set aside extra money or
provisions to cover potential losses from any bond-buying,
reflecting the riskiness of their bonds.

    • About Paul

      "I lead our economic news file from Berlin, where we report on the performance of the German economy – Europe’s largest – and economic policy: everything from financial regulation to dealing with the euro zone debt crisis. I previously reported on political and economic news from Paris and on earlier assignments worked in Frankfurt, Vienna and London."
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