ECB increases its purchases in Portugal for the first time in four months

  • ECO News
  • 7 August 2017

In the end of July, the European Central Bank held 28.6 billion euros in debt securities from the Portuguese Government. During that month, the monetary authority acquired 517 million euros in debt.

The European Central Bank’s presence in the Portuguese public debt market continues to be shy. In July, the central bank purchased 517 million euros in bonds from the Portuguese Government. Although it is still beyond what ECB is allowed to purchase, this was an increase in their purchases in Portugal for the first time in four months.

According to the update on the public sector purchase programme (PSPP), the institution reinforced its portfolio of Portuguese public debt in 517 million euros last month, after having purchased only 498 million euros in the previous month. This was the first increase since April, although the rules of the plan allow Mario Draghi to purchase three times as much Portuguese debt per month.

This means that by the end of July, ECB held 28.662 billion euros in debt, considering the purchases made in the past 29 months through the plan which has been containing the increase in many country’s debt risk.

The ECB has been an active agent in the purchase of Treasury bonds in the Euro Area since March 2015, as a way to highlight the recovery in the economy and also to pull the prices around its goal of around 2%. The ECB had been making purchases of around 80 billion euros per month, but since April of 2017, the monetary authority decreased its purchases to 60 billion euros per month, which signaled the phasing out of the less conventional monetary policies implemented by the institution. The programme should end in the last months of 2018. Next Fall, there will be news about its future, acording to Mario Draghi.