“It’s nowhere in the mandate of the ECB to be the actor by default,” Mersch, who is Banque du Luxembourg governor, said. “Acting by default would create the wrong incentives.”
The ECB has intervened repeatedly to calm the bond market in recent months through buying Greek, Spanish, Irish, Portuguese and Italian bonds as fears about them defaulting on their debt repayments grew.
An increasing number of analysts believe that the ECB may have to step in on a larger scale in coming months, if the euro zone crisis continues to escalate.
“Some of the measures that we have taken are limited in volume and time and can only serve the purpose of increasing the efficiency of the monetary transmission mechanism,” Mersch warned.”
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