THE EUROPEAN Central Bank (ECB) bought €1.7bn (£1.34bn) worth of bonds last week as it began its new purchase programme, data published yesterday reveals.
The rate of purchases is slow. It would take at least six years for the ECB’s balance sheet to reach the size it was during 2012 – a target ECB president Mario Draghi has hinted at.
Draghi hopes the programme will boost lending, raise inflation, and revive the Eurozone economy.
Eurozone annual inflation is currently 0.3 per cent while lending to individuals and firms fell by 1.2 per cent annually in September, data released today shows.
The risk of another recession looms after 0.1 per cent economic growth in the second quarter of 2014 and weak survey data since.
The bonds currently being purchased are covered bonds which are backed by pools of mortgages. Germany hotly contests the purchase of government bonds.