June 9, 2020 / 9:32 AM / a month ago

ECB's Rehn has 'open mind' in debate over buying fallen angels

FILE PHOTO: Governor of the Bank of Finland, Olli Rehn attends a Reuters Newsmaker event in London, Britain, May 29, 2019. REUTERS/Hannah McKay

HELSINKI (Reuters) - European Central Bank policymaker Olli Rehn has an “open mind” in the debate over whether the bank should buy corporate bonds that lose their investment grade rating in the current crisis, but there has been no serious discussion over the issue, he said on Tuesday.

“Concerning possible purchases of high yield bonds, this is something that one can contemplate and I look at the various options with an open mind,” Rehn said. “But we have not had serious discussions on this and I would rather first have our internal discussion on this matter before commenting it in public.”

The ECB has warned that looming downgrades pose a risk to the corporate bond market and financial stability as the market is too small to absorb the likely surge in supply.

Reporting by Anne Kauranen and Balazs Koranyi; Editing by Alex Richardson

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