© Reuters. FILE PHOTO: Vice-President of the European Central Bank (ECB) Luis de Guindos gives a statement during the second day of the Informal Meeting of EU Ministers for Economics and Financial Affairs in Berlin, Germany September 12, 2020. Odd Andersen/Pool via
MADRID (Reuters) – The European Central Bank’s tool to combat rising government debt yields in some euro zone countries should not interfere with the bank’s aim to control inflation, ECB Vice-President Luis de Guindos said on Wednesday.
“Fragmentation instruments should not interfere with the overall monetary policy approach, which should be focused on fighting inflation,” De Guindos told a financial event in Spain.
In an emergency meeting last week, the European Central Bank decided to direct bond reinvestment to help nations on the bloc’s southern rim, and to devise a new instrument to contain divergence in borrowing costs.
De Guindos said that fragmentation was among the significant concerns of the ECB and that it was committed to combat it though details had still not been discussed at the bank’s governing council yet.
Anti-fragmentation tool should not interfere with goal to fight inflation, ECB’s De Guindos says