So much for the European Central Bank meeting having a summery feel! Jean-Claude Trichet, president, announced bolder measures to confront the escalating eurozone crisis than expected – but financial markets still decided they did not go far enough.
Even so, Mr Trichet again found himself running into Bundesbank resistance. Jens Weidmann, its new president, interrupted his holiday to attend Thursday’s meeting in Frankfurt – and vote against the decision to revive the ECB’s bond purchasing programme. The word in Frankfurt is that he was not the sole dissenter. As such, he dashed any expectations that Axel Weber’s departure earlier this year as Bundesbank president would make life easier for Mr Trichet.
That does not bode well for Mario Draghi, who takes over as ECB president on November 1. An early objective will be to shore up German support for the ECB.
Italy’s central bank chief may also find himself clashing openly with the government in Rome. The ECB decided deliberately on Thursday that it would not buy Italian bonds – a move that would have taken some of the pressure off Silvio Berlusconi’s government. Mr Draghi is probably unlikely to let the world know how he stood on the subject but its probably reasonable to assume he backed Mr Trichet’s strategy.