The European Central Bank’s members will meet against the backdrop of a pledge by President Mario Draghi to help the finances of the region through the purchase of the sovereign debt of the eurozone’s most troubled nations. In theory, this should bring down their borrowing costs, especially if global capital markets investors slow or stop the rate at which they have abandoned the paper.
But Draghi’s plan may never see the light of day, which would deepen the debt crisis and trigger more calls for additional austerity or worry about defaults. Bundesbank President Jens Weidmann says he objects to the plan. Germany’s powerful position in Europe’s finances could upset Draghi’s program.
Douglas A. McIntyre
