Figures from the European Central Bank indicate that it continued to keep its controversial purchases of government bonds at a trickle last week, despite recent market talk of buying of Irish bonds.
The ECB said it had completed €10m worth of bond buys last week, compared with €9m the previous week. It has now bought €60.5 billion worth in total.
The ECB's figures include only trades settled to last Friday and the actual purchase amount could be higher than the reported total, as it takes 2-3 days for purchases to settle.
There were reports last week that the ECB bought €60m of 2012 Irish government bonds after the spread over German bonds - the premium demanded by investors for buying Irish rather than German bonds - rose sharply. This means next week's ECB figures are likely to be watched more closely for indications of Irish bond buys.
The ECB figures come a day ahead of the latest auction of Irish bonds by the National Treasury Management Agency. The auction is aimed at raising €1.5 billion.
As in previous weeks, the ECB said it would offer commercial banks up to 1% in interest to park an equal amount of their own funds at the ECB for the next week, a move that is designed to prevent the bond purchases kicking up inflation. It also said it would repeat the process next week.
Under the programme, the ECB can buy government and corporate bonds but has given no further details, such as how much it could spend or how long it intends to buy bonds.
Meanwhile, it is reported that the cost of insuring Irish government debt against default rose to 17-month highs this morning. Markit, which monitors the cost of insuring debt, as indicated by credit default swaps (CDS), said the five-year cost for Ireland climbed 0.2 percentage points on the day to 3%, a high last seen in March 2009. This means it now costs €300,000 to insure an exposure of €10m of Irish Government bonds.
The premium investors demand to hold Irish government bonds rather than German benchmarks also remained above three percentage points this evening.
