What is a Sovereign Debt Crisis? Why Europe’s Bond Stress is Back in Focus - EBC Financial Group
What is a Sovereign Debt Crisis? Why Europe’s Bond Stress is Back in Focus - EBC Financial Group
Source: EBC Financial Group
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DW NOTE
The ECB holds €4.9 trillion in sovereign bonds accumulated through fifteen years of QE programmes designed to prevent exactly the kind of stress now building across the periphery. When your central bank owns that much of your debt market, you no longer have price discovery — you have a permanently backstopped auction where the only real question is how long political cover for unlimited bond-buying can survive contact with 5.44% producer inflation.