ECB’s Villeroy backs using Europe’s rescue fund for virus crisis

BANK of France Governor Francois Villeroy de Galhau said Europe’s rescue fund should be activated to lend to states struggling with the coronavirus outbreak

BANK of France Governor Francois Villeroy de Galhau said Europe’s rescue fund should be activated to lend to states struggling with the coronavirus outbreak, a move that could pave the way for further sovereign bond purchases by the European Central Bank.

Villeroy’s call comes as euro-area officials consider a plan that would see the European Stability Mechanism set up multiple credit lines for euro-area nations. Such a step would be necessary, although not sufficient, for the ECB to undertake bond buying under its Outright Monetary Transactions program.