Has Axel Weber, head of Germany’s Bundesbank, just blown his chances of becoming European Central Bank president next year? In an interview with the country’s Börsen Zeitung newspaper, to be published on Tuesday, he warns of the risks to monetary stability involved in buying government bonds and says he saw this part of the ECB’s actions “critically”.
His opposition is not surprising. What is, is Mr Weber’s decision to make his view public. Open dissent is viewed dimly within the ECB – and the Bundesbank president’s comments risk undermining the effectiveness of yesterday’s package. Read more
An old debate at the European Central Bank has just been reignited by Axel Weber, Bundesbank president. Speaking at a media prize ceremony in Hamburg he has repeated his concern about the use of “code words” to signal likely future interest rate movements.
This was a big issue when the ECB was raising borrowing costs between the end of 2005 and July 2008. A warning by Jean-Claude Trichet, president, that the governing council was exercising “strong vigilance” was as near as you could get to confirmation that interest rates would rise a month later.
Mr Weber argued in Hamburg that such tactics allowed the ECB to manage expectations without committing itself. The danger was that financial markets became too focused on listening for code words, rather than analysing properly the economic situation. Read more
Ralph Atkins, of the Financial Times, wonders if Axel Weber is turning more hawkish Read more
Weber is engaged at power struggles at the Bundesbank, writes the Financial Times’ Ralph Atkins Read more