by Mike ‘Mish’ Shedlock
Mish Talk
ECB rules say QE bond purchases must be weighted according to size of the economy. That means German bonds are the preferred issue.
The rules also stipulate a floor interest rate of -0.4%. Most German bonds trade below that figure.
Expect a rule change because the ECB wants to continue its ridiculous and counterproductive QE program.
Please consider The ECB Could Soon Run Out of Bunds to Buy.