ECB Asset Purchase Program Unfair to Neediest Nations

Earlier this month, the European Central Bank (ECB) extended the end date for its asset-purchase program to December of 2017. This change has forced officials to relax the rules guiding the program to avoid running out of eligible bonds to buy, according to a Wall Street Journal article. As a result, more stimulus is delivered to the healthiest economies and less to those that are lagging behind. The central bank is mandated to spread its purchases according to how much capital each country has at the ECB.

“Speaking to some of our own clients, the idea that the central bank is running into a wall is a concern for them, especially when it comes to Ireland and Portugal,” said Marchel Alexandrovich, Economist at Jefferies Group LLC.

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