ECB's Weidmann voices opposition to ABS purchases

FXStreet (Łódź) - Speaking at the economic conference in Riga, Latvia on Friday, Bundesbank president Jens Weidmann reiterated that ECB's decision to buy asset-backed securities was problematic in his opinion and in contradiction to the achievements in Eurozone banking regulation made so far.

Weidmann said that ABS purchases would just transfer risk from banks to ECB's balance sheet which would finally result in burdening the taxpayers.

Furthermore the Bundesbank remarked that he didn't see a threat of deflation in the Eurozone, although inflation could remain at low levels for an extended period of time. He urged EU national governments to continue implementing structural reforms.

“The biggest bottleneck for growth in the euro area is not monetary policy, nor is it the lack of fiscal stimulus: it is the structural barriers that impede competition, innovation and productivity,” he said.