QEuro may help Deutsche Bank next stress test

The ECB bought $10.33 billion of bonds with an average maturity of nine years in the first three days of QEuro operation, Benoît Coeuré, an EU board member said Thursday.

There was no breakout on bond issuance, but a good guess the 10-yr German bund figured mightily in the purchases, since its yield moved over 30% during those trading sessions.

The EU’s massive stimulus program will buy some  €60 billion a month in  government bonds, debt instruments issued by EU institutions and private debt instruments through to September 2016.

Another reason to believe German debt was the bulk of the early buying comes from yesterday’s Fed announcement the Deutsche Bank failed the US stress test along with Santander Bank, Bank of America was told to retake the test and resubmit its answers by Sept.

Deutsche has long been seen as a zombie institution propped up by the German government and may have been the principal reason the Angela Merkel government decided to back QEuro in the first place.



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