Much ado about nothing from the Eurotower. Last week the ECB did not buy any government bonds from Eurozone countries. This is confirmed by the weekly data released today by the same institution in Frankfurt. Therefore, the rumors that have been chasing each other in recent days turn out to be words in the wind, up to the controversy fueled by Elena Salagado, the Spanish finance minister.
The suspicion was that the European Central Bank had bought Greek and Portuguese bonds when the markets expected the purchases to be directed mainly towards Rome and Madrid. Instead nothing. In reality, the ECB has not lifted a finger. The total amount of bonds purchased remained nailed to 74 billion euros: the same value that the ECB has been reporting for 19 weeks now.
Today, instead, it seems that from Frankfurt they have finally started buying Italian and Spanish government bonds, news that immediately threw water on the fire of yields, bringing the spreads of both countries back to well below 300 basis points. According to Michael Schubert, an economist at Commerzbank, today's data "doesn't come as a surprise" because it does not include the trades carried out on Thursday and Friday.
And this is the reason, he adds, why the total amount of bonds purchased has remained unchanged at 74 billion euros: this item will show changes only in next week's data. Yesterday evening, after an extraordinary meeting of the Governing Council, the President of the ECB, Jean Claude Trichet, reiterated once again that the government bond purchase program remains in operation, and that he intends to use it "actively".
