The European Central Bank (ECB) is putting together a contingency plan that would allow it to carry out the Public Sector Purchase Programme (PEPP) bond-buying scheme without Bundesbank, Reuters reported, citing four sources.
“The ECB is seen buying German bonds even if Bundesbank is forced to quit the PSPP,” sources told Reuters. “The ECB would likely launch an infringement procedure against Bundesbank if it stops buying bonds under PSPP.”
Market reaction
With the initial market reaction, the EUR/USD pair edged higher and was last seen trading at 1.0978, adding 0.72% on a daily basis.
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