The European Central Bank’s public debate over buying government bonds is reaching a climax. After weeks of argument about quantitative easing in speeches and interviews, officials have just a few days left before a conventional quiet period starts ahead of their Jan. 22 policy meeting. Adding to the intensity, a European court opinion is due that could color any program.
ECB President Mario Draghi’s drive to win over critics of his policies in Germany, the region’s biggest economy, will take him to Berlin for a Jan. 14 conference, a day before QE-opponent Jens Weidmann speaks in the south of the country. They and other officials should then stay out of the limelight before the 25-member Governing Council meets next week in Frankfurt to decide how best to stave off a deflationary spiral in the euro area.
“The issue is about finding a common denominator that most people can agree on,” said Anatoli Annenkov, senior economist at Societe Generale SA in London. “It’s easy to see there is a majority among governors to move ahead. Much less clear is how much risk they are willing to take and how this support translates into practice.”
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