HALISTER1: ECB PGB, IRISH QE Buying Above Target Even as Pace Slows: UBS

ECB PGB, IRISH QE Buying Above Target Even as Pace Slows: UBS

(Bloomberg) -- QE purchases of Portuguese and Irish govt bonds are running ahead of the target implied by the capital key even after the April slowdown in the pace of purchases, Nishay Patel and Justin Knight write in client note.
  • Eurosystem buying of Portuguese debt was 4% more between March 2015 and March 2016 and slowed to 1.7% above target since April
  • For Irish bonds, the purchases are still 4% higher
  • Should the issuer limit be reached, possibly by the end of the year for PGBs, it could lead to substitute purchases, something the ECB has repeatedly said are allowed under the legal act
  • NOTE: ECB limited its purchases of Portuguese, Irish govt bonds because of concerns it would reach its limits, Reuters said yday, citing unidentified central banking sources
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

Tickers
2539Z GR (European Central Bank)
1174Z PL (Portuguese Republic)

People
Justin Knight (UBS Global Asset Management Japan Ltd)
Nishay Patel (UBS Global Asset Management Japan Ltd)

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