Trichet Says ECB Resumed Bond Buying as Debt Crisis Spreads

European Central Bank President Jean- Claude Trichet said the ECB has resumed bond purchases and will offer banks more cash to stop the region’s debt crisis from engulfing Italy and Spain and hurting the economy.

“I wouldn’t be surprised that before the end of this teleconference you would see something on the market,” Trichet told reporters in Frankfurt today after the ECB kept its benchmark interest rate at 1.5 percent. “We were not unanimous but with overwhelming majority with regards to the bond purchases.”

The ECB, which ceased buying the bonds of distressed euro- area governments 18 weeks ago, was under pressure to re-enter markets after Italian and Spanish yields soared to euro-era records. European officials are trying to put a firewall around Italy and Spain on concern they will have to follow Greece, Ireland and Portugal in seeking bailouts.

Read Full Article from BusinessWeek

- Posted: 2011-08-04 10:04:28

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