ECB Spends 85.1 Billion Euros on QE in Brexit-Blighted June
(Bloomberg) -- The European Central Bank bought 85.1 billion euros ($94.8 billion) of debt in June as it boosted its asset-purchase program before the summer holiday period, and as officials considered how to handle the fallout from the U.K.'s decision to quit the European Union.
Holdings of public and private-sector debt climbed to 1.08 trillion euros as of June 30, data on the ECB's website showed on Monday. The period includes the week after the U.K. sent shockwaves through the financial system with its Brexit vote.
While the ECB had initially signaled that its quantitative-easing program was unlikely to be adjusted or extended over the summer months, President Mario Draghi must now decide whether the impact of the U.K. decision warrants a response. Policy makers are said to be concerned that the pool of securities eligible for QE has shrunk after investors piled into the region's safest assets and pushed down yields on some sovereign debt too far to meet current criteria, Bloomberg reported last week.
The pace of buying in June was similar to May's 85.2 billion euros and compares with a target of 80 billion euros a month. Holdings of sovereign and agency debt climbed by 72.1 billion euros last month, the ECB data showed. Corporate-bond purchases, under a program that started on June 8, were 6.4 billion euros. Covered bonds rose by 6.1 billion euros and asset-backed securities by 532 million euros.
The ECB didn't accelerate purchases after the U.K. vote. Holdings of public sector debt rose by 9.7 billion euros versus 17.1 billion euros increase in the previous week. Buying of covered bonds and corporate debt also slowed. ABS purchases picked up slightly.
Executive Board member Peter Praet warned last week that Brexit may reverse some of the euro area's recent investment and consumption gains. Some Governing Council members favor changing the allocation of bond purchases away from the size of a nation's economy toward one more in line with outstanding debt.
--With assistance from Carolynn Look To contact the reporter on this story: Piotr Skolimowski in Warsaw at pskolimowski@bloomberg.net. To contact the editors responsible for this story: Paul Gordon at pgordon6@bloomberg.net, Jeff Black
-
Unhedged Position: Can India See An Indonesia-Style Time Correction?
The Nifty is trading below levels it first clocked in 2024. Is there, then, as I have suggested in the headline, potential that the current time correction drags on painfully for the next three-five, even ten years?
-
Navigating Friction And Energy Realities: An Analysis Of Marco Rubio's October Visit To India
Occurring at a critical juncture marked by stalled trade negotiations and escalating geopolitical pressures over global energy supplies, the visit offers a profound window into modern US-India relations.
-
India Exports Capital. Why Not Export Trusteeship?
The big question, then, is whether India can build an institution that global borrowers, investors, banks, and lawyers can trust, even without an Indian connection.
-
France's Economy & Politics Are In Crisis | The Reason Why
Let's look at how the French economy and politics evolved under Nicolas Sarkozy, Franois Hollande and Emmanuel Macron.
-
You May Inherit The Business. You Must Earn Its Credibility.
Succession tests the founder's ability to share authority as much as it tests the next generation's readiness to assume it.
-
Signing Deals Is One Thing; Making Them Work Is Another | The Week In Whys
Sometimes, things don't turn out as planned. Indian companies have lost some bids to rivals, some projects won't produce until 2030.
-
FOMC Wall, PERM Suspension, Hospital Stocks | Talking Points This Week
A PERM suspension would directly affect green-card sponsorship rather than H-1B visas, so the near-term earnings impact could remain relatively limited. The key question is whether this marks a new phase in US scrutiny of Indian IT.
-
Everything, Everywhere, All At Once: Dalal Street's Week To Forget | Joining The Dots
Visa curbs, a Starlink spat and cancer drug caps: what connects this week's shocks for Indian markets
-
India Is Going Abroad For Critical Minerals. But It May Take Years To Pay Off | The Reason Why
Although India's steps are in the right direction, they remain modest compared with India's growing dependence.
-
When Everyone Has AI, What Gives You An Edge?
India's young workforce is entering an uncertain world of work where powerful AI tools are becoming widely accessible. The advantage will belong to those who combine deep expertise with digital fluency, and the distinctly human capabilities that technology cannot manufacture.
