ECB Executive Board member Sabine Lautenschlaeger has said this weekend that she saw little room for further easing of monetary policy despite a further fall in Eurozone inflation.
Speaking in Berlin ahead of Thursday’s eagerly awaited ECB meeting she added that the effects of large scale sovereign bond buying would not be positive.Lautenschlaeger said the interest on national government bonds in the euro area didn’t operate as a benchmark for all further refinancing operations, as is the case in Britain or the United States.
In my view, a consideration of the costs and benefits, and the opportunities and risks of a broad purchase program of government bonds does not give a positive outcome at the current time.
For me, given the current situation, the hurdles for further measures are very high, especially for broad purchase programs
Innovation in monetary policy was not a taboo, but must also not be an “end in itself”, she said, adding that “careful consideration of its efficiency was necessary”.
The debate continues on whether the ECB can, will or when introduce QE with such constant German opposition in contrast to the calls this week by Draghi and Constancio to get it underway sooner rather than later
Lautenschlaeger- The lady’s not for easing
