The PSPP Government Bond Programme: Empirical Data and Rulebook Call the BVerfG Judgment Partly into Question

Dirk Meyer ()
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Dirk Meyer: Helmut-Schmidt-Universität

Chapter Chapter 13 in European Union and Monetary Union in Permanent Crisis I, 2022, pp 245-278 from Springer

Abstract: Abstract This article analyses the sovereign bond purchases under the PSPP (Public Sector Purchase Programme) in the light of the ruling of the German Federal Constitutional Court (BVerfG) 2 BvR 859/15 of 5 May 2020. While the court cannot see any obvious circumventing of the ban on monetary financing of the state through the ‘guarantees’ it has established, their compliance is critically questioned by means of an analysis of ECB decisions and empirical data. The economic analysis therefore questions the extent and monetary policy orientation of the PSPP. The focus is on the divergence of the shares of individual countries in PSPP purchases from the ECB’s capital key, the lack of transparency and the pooling of possible losses. In addition, the examination of the ‘guarantees’ on the PEPP programme is extended and it is analysed what the consequences of unwinding the programmes would be.

Date: 2022
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Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-3-658-38643-6_13

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DOI: 10.1007/978-3-658-38643-6_13

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