FRANKFURT—European Central Bank President Mario Draghi offered to appear before Germany's parliament to explain the bank's new bond-buying strategy, his latest attempt to convince skeptical Germans that the ECB's open-ended commitment to purchase bonds of Spain and other struggling euro countries is necessary to help resolve Europe's debt crisis.
Mr. Draghi made the offer in an interview published Friday with German daily Sueddeutsche Zeitung.
"We need to explain what we do better in Germany, what our intentions are and what precautions we are taking," he said.
It was his first interview since the ECB announced last week that it would buy unlimited amounts of short-maturity government bonds if needed to bring borrowing costs down, provided countries first request assistance from Europe's bailout fund and agree to conditions on budget cuts and economic reforms.
Members of Germany's lower house of parliament, the Bundestag, quickly took him up on the offer, though no date has been set.
"I think that we need to talk to him in committee on these measures," Carsten Schneider, a budget expert for the center-left SPD party, said in parliament Friday.
Many Germans consider bond purchases by central banks as a dangerous crossing of the line into government fiscal policy, weakening the central bank's independence and potentially giving rise to inflation.
These critics are led by Germany's powerful central bank, the Bundesbank, which warned hours after the ECB's decision last Thursday that buying bonds is "tantamount to financing governments by printing banknotes."
Last year, two of Germany's top ECB officials, including former Bundesbank President Axel Weber, resigned in opposition to the ECB's previous bond-purchase program.
Mr. Draghi defended the decision, telling the German daily that the new bond-buying facility, called Outright Monetary Transactions, "has contributed to raising confidence in the euro area, and in the euro across the world." Doing nothing would have been an even riskier strategy, he said.
So far, Mr. Draghi has the support of top German politicians, including Chancellor Angela Merkel and Finance Minister Wolfgang Schäuble, giving him some political cover in Berlin despite the Bundesbank's vehement opposition.
Opinion polls suggest Ms. Merkel enjoys broad voter support in Germany for her handling of the debt crisis in southern Europe, so that her defense of ECB bond-buying as "within its mandate" could help Mr. Draghi to defuse German popular anxiety over the ECB's move.
wsj.com
Mr. Draghi made the offer in an interview published Friday with German daily Sueddeutsche Zeitung.
"We need to explain what we do better in Germany, what our intentions are and what precautions we are taking," he said.
It was his first interview since the ECB announced last week that it would buy unlimited amounts of short-maturity government bonds if needed to bring borrowing costs down, provided countries first request assistance from Europe's bailout fund and agree to conditions on budget cuts and economic reforms.
Members of Germany's lower house of parliament, the Bundestag, quickly took him up on the offer, though no date has been set.
"I think that we need to talk to him in committee on these measures," Carsten Schneider, a budget expert for the center-left SPD party, said in parliament Friday.
Many Germans consider bond purchases by central banks as a dangerous crossing of the line into government fiscal policy, weakening the central bank's independence and potentially giving rise to inflation.
These critics are led by Germany's powerful central bank, the Bundesbank, which warned hours after the ECB's decision last Thursday that buying bonds is "tantamount to financing governments by printing banknotes."
Last year, two of Germany's top ECB officials, including former Bundesbank President Axel Weber, resigned in opposition to the ECB's previous bond-purchase program.
Mr. Draghi defended the decision, telling the German daily that the new bond-buying facility, called Outright Monetary Transactions, "has contributed to raising confidence in the euro area, and in the euro across the world." Doing nothing would have been an even riskier strategy, he said.
So far, Mr. Draghi has the support of top German politicians, including Chancellor Angela Merkel and Finance Minister Wolfgang Schäuble, giving him some political cover in Berlin despite the Bundesbank's vehement opposition.
Opinion polls suggest Ms. Merkel enjoys broad voter support in Germany for her handling of the debt crisis in southern Europe, so that her defense of ECB bond-buying as "within its mandate" could help Mr. Draghi to defuse German popular anxiety over the ECB's move.
wsj.com
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