German court ruling on ECB powers calms bond markets

London

A DECISION by Germany's top court to reject a challenge to an emergency European Central Bank (ECB) bond-buying scheme comforted bond markets on Tuesday as investors braced for Britain's too-close-to-call referendum on whether to stay in the European Union.

Conceived at the height of Europe's debt crisis in 2012, the Outright Monetary Transactions (OMT) programme was launched as part of ECB chief Mario Draghi's pledge to do "whatever it takes" to preserve the euro, giving the central bank broad powers to buy the debt of financially strained member banks.