ECB president defends bond-buying program

The President of the European Central Bank Mario Draghi on Wendesday said the group had designed operations to minimize the risks amid concerns over its bond-buying program "Outright Monetary Transactions" (OMT). Since the bond buying will only take place on secondary markets and it only involves buying government debt from investors instead of governments, the OMTs will not lead to disguised financing of governments, said Draghi. Draghi also pledged that the ECB would continue to take all decisions related to the OMTs in full independence. Through the programs attached to the EU's permanent rescue fund European Stability Mechanism, the OMTs will not create excessive risks for euro area taxpayers. The ECB has designed the operations so that their effect on monetary conditions will be neutral, Draghi said, and the program will not lead to inflation. As of the economy in the euro area, Draghi said the ECB expects it to remain weak in the near term and recover gradually from next year. The ECB has responded to the situation by lowering the key interest rates. According to Draghi, there were fears about the future of the euro area, and efforts should be made to establish a fully credible backstop against disaster scenarios, said Draghi.