Europe Bank Chief Hints at Bond Purchases

BRUSSELS—The president of the European Central Bank dropped more hints about how the bank could support struggling countries, suggesting the bank was free to buy government bonds maturing in three years or less.

The comments by Mario Draghi in a closed hearing at the European Parliament on Monday came ahead of the ECB’s monthly policy meeting Thursday. That meeting has been keenly awaited in the financial markets for further details of how the bank could help bring down the funding costs of countries such as Spain and Italy to prevent them from having to seek full euro-zone bailouts like Greece, Ireland and Portugal.

While the ECB president’s comments may remove lingering doubts about the bank’s willingness to intervene in bond markets, several European officials familiar with discussions among euro-zone governments said in recent days that Spain may not request financial support for several months—a step Mr. Draghi has indicated is necessary for the ECB to step in.

Wall Street Journal

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