Investors Are Worried That A German Court Hearing On Wednesday Could Damage Stabilit
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On Wednesday, the German Constitutional Court will hold a public hearing on the legality of the European Central Bank's "outright monetary transactions" (OMT) program.
The OMT is a program announced last summer that gives the ECB the ability to backstop government bonds, provided said country agrees to oversight and reforms.
Remarkably, the ECB has yet to actually engage in any outright monetary transactions.
However, as ECB President Mario Draghi put it in a press conference on Thursday following the central bank's latest decision on monetary policy, "OMT has brought stability, not only to the markets in Europe but also to the markets worldwide."
As such, people are talking about this week's court hearing.
Société Générale interest rate strategist Ciaran O'Hagan asserts that there is "much concern over what damage talk at the German constitutional court might do."
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