ECB’s Plan Leaves an Uneasy Feeling

European Central Bank (ECB) President Mario Draghi gave more details of its asset purchase programs on Thursday, but left markets uneasy by failing to give clear guidance on their size.

Speaking at a press conference following the ECB’s monetary policy decision, where it kept rates on hold, Draghi revealed that it would start buying covered bonds from the middle of October, and asset-backed securities (ABS) in the fourth quarter.

Asset-backed securities are pooled loans put together by banks which have been made to companies or consumers, including mortgages and credit cards. The bundled loans are then sold on to other banks but also to insurers, pension funds.

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