Bundesbank chief wants ECB to start reducing debt pile in Q1
The European Central Bank should start reducing its large holdings of government debt in the first quarter of next year as part of its fight against high inflation, Bundesbank President Joachim Nagel said on Thursday.
This reduction, often called quantitative tightening, should be done by not replacing all the bonds that mature, rather than through outright sales, Nagel said in a speech.
This approach would allow bond yields to rise, ease a collateral shortage in the market and underline the ECB's determination to reduce inflation, Nagel said.
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