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Purchasing short-dated bonds doesn’t constitute state financing, Draghi said during a closed-door parliamentary session in Brussels today, Gauzès told reporters afterwards. “He thinks it’s not a violation of the treaty and you can do it under the current legal framework”, said Gauzès, a French Christian Democrat. “He said for example three years is ok, 15 years no.”
Sven Giegold, a German Green member of the European Parliament who attended the closed-door meeting with Draghi, said he left it with the impression that the ECB will renew intervention in bond markets to stem the debt crisis. The ECB shelved its previous purchase programme earlier this year.
“I assume after this meeting that there will continue to be intervention on the secondary market”, Giegold told reporters. He declined to elaborate on the talks with Draghi about this issue, citing their confidentiality. Giegold also said Draghi spoke out against giving the ESM a banking licence on the grounds that such a step would entail monetary financing of governments.