August 29, 2014
FRANKFURT, Germany (AP) - Germany's top central banker has repeated his opposition to the European Central Bank intervening in bond markets to lower borrowing costs for indebted governments such as Spain and Italy.
Bundesbank head Jens Weidmann said in Monday's edition of Der Spiegel magazine that governments could become dependent on such help rather than fixing their finances. He said "we should not underestimate the danger that central bank financing can be as addictive as a drug."
Weidmann, who sits on the the ECB governing council, also said that the risk would be borne by eurozone taxpayers. He said elected parliaments, not central banks, should make such decisions.
European Central Bank head Mario Draghi has said the bank may buy government bonds if troubled governments first ask for help from the eurozone bailout fund.
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