Mario Draghi set to unveil ECB bond-buying euro plan

 

 Mario Draghi has said he will do "whatever it takes" to save the euro

Mario Draghi, president of the European Central Bank, is expected to unveil details of a new bond-buying plan later, aimed at easing the eurozone's debt crisis.

In July, Mr Draghi had said that he would do "whatever it takes" to save the euro.
The ECB is expected to help cut the borrowing costs of debt-burdened eurozone members by buying their bonds.
However, Germany's Bundesbank is vigorously opposed to the idea.
Jens Weidmann, the Bundesbank president, is concerned member states could become hooked on central bank aid and fail to reform their economies sufficiently.
But the majority of the 23 ECB council members are expected to support the plan.
And the Organization for Economic Co-operation and Development (OECD) added its support for the ECB bond-buying plan on Thursday, as it warned that the eurozone crisis posed the greatest risk to the global economy.
It is calling for more action from central banks to prevent a break-up of the eurozone.
"Concerns about the possibility of exit from the euro area are pushing up [government bond] yields, which in turn reinforces break-up fears," the OECD said in its global economic outlook.
"It is crucial to stem these exit fears. This could be achieved by the ECB undertaking bond market intervention to keep spreads within ranges justified by fundamentals."
The bond markets are hoping for Mr Draghi to put flesh on the bones of an idea that has been widely trailed in the run-up to the latest meeting.

Mr Draghi is hoping that ECB intervention in the bond markets will help reduce the borrowing costs of debt-laden countries such as Spain and Italy and lessen the likelihood of them needing to ask for a full sovereign bailout, an eventuality that could bankrupt the eurozone and cause the collapse of the euro.
Spain, which has already asked for 100bn euros (£79bn) in state aid to help its debt-stricken banks, is currently paying yields of 6.42% on its 10-year bonds, while Italy's 10-year bond yields are 5.51%, below the critical 7% figure thought likely to trigger a sovereign bailout request.
From BBC News