The Federal Constitutional Court is considering whether the bank overstepped its legal authority by creating the Outright Monetary Transations (OMTs) which were an offer by the ECB to purchase the government bonds of a country in financial crisis. OTMs were designed to assist in lowering the country’s borrowing costs in bond markets.
For or against
According to Associated Press, the German Finance Minister Wolfgang Schaeuble defended the programme for its aid in helping the crisis. The president of Germany's influential central bank, Jens Weidmann, argued that ,on the contrary, the ECB endangered monetary policy.
Stabalisation of the EU
Others support the ECB because of its help with the stabilisation of the EU. Finance Minister Wolfgang Schaeuble said it was "highly questionable whether the constitutional court had the legal right to rule on the ECB's actions given that the ECB is an independent institution and is governed by EU law.”
A final decision is not expected for several months, but there is a chance that the case could be referred to the European Court of Justice, the Associated Press reports.
Email your news and story ideas to: [email protected]
