German central bank risks bailout after money printing spree.
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Germany’s central bank may need a bailout to cover losses on the debt it hoovered up as part of the European Central Bank’s (ECB) massive bond-buying programme, the country’s federal auditor has warned.
The Bundesrechnungshof said losses faced by the Bundesbank on more than €650bn (£570bn) of bond purchases were “substantial” and “could necessitate a recapitalisation with budgetary funds”.
The critical report of the ECB’s so-called public sector purchase programme (PSPP) – akin to quantitative easing in the UK and US – throws future bond-buying sprees to prop up the single currency bloc in doubt.
Economists have blamed bond-buying programmes for stoking inflation amid a series of negative supply shocks that have increased the risk of economies overheating.
Steep rate hikes by the ECB meant that the Bundesbank suffered a €1bn hit to its bond holdings last year alone.
https://www.msn.com/en-gb/money/othe...07a6c8b9&ei=35
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