French President Says ECB To Announce Sovereign Bond Purchases This Week

French President François Hollande said Monday the European Central Bank will announce plans to buy eurozone sovereign debt later this week, reinforcing expectations the Frankfurt-based institution will follow other major central banks into so-called quantitative easing.

“On Thursday, the ECB will take the decision to buy sovereign debt, which will provide significant liquidity to the European economy and create a movement that is favorable to growth,” Hollande said in a speech to business leaders at the Élysée Palace.

The comments from the French leader were surprising as they appear to foretell the action of the ECB, which fiercely guards its independence from governments. Still, analysts do widely expect the ECB to announce plans to buy sovereign debt Thursday as other measures to stimulate the eurozone economy have failed to lift inflation from super low levels.

An ECB spokesman declined to comment, noting that the ECB’s meeting is on Thursday.

Hollande made the remark midway through a speech outlining the outlook for France’s economy. He pointed to a variety of external factors that could boost the sluggish economy, including the slump in oil prices and a weakening of the euro.

via MarketWatch

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza