France says ECB only responds to European Court of Justice

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FILE PHOTO: French Minister of Economy and Finance Bruno Le Maire listens to French Prime Minister Edouard Philippe delivering a speech to present the French government’s plan to cancel the foreclosure of the country’s coronavirus imposed to slow the rate of coronavirus disease (COVID-19) at the National Assembly in Paris France, April 28, 2020. David Niviere / Pool via REUTERS

PARIS (Reuters) – French Finance Minister Bruno Le Maire said it was up to the European Central Bank to judge what monetary policy was needed for the eurozone, Wednesday responding to a German court ruling demanding that the ECB justifies its bond purchases as part of its stimulus scheme.

The Mayor said that the independence of the ECB was guaranteed by European treaties, which were only supervised by the Court of Justice of the European Communities (ECJ).

“(The ECB) takes its decisions independently and decides how to carry out its mandate under the exclusive control of the Court of Justice of the European Union,” he said in a statement.

Germany’s highest court ruled on Tuesday that the ECB had to prove within three months that its purchases of government bonds were proportional, and that otherwise the Bundesbank would have to exit the system.

The decision pitted him against the ECJ, the highest court in EU law, which authorized the bond purchase program in 2018.

“Within the euro area, we are all committed to the independence of the ECB, which enables it to fulfill its mission independently under the supervision of the European Court of Justice,” said Le Maire.

“The decision of the Karlsruhe Constitutional Court is not a factor of stability.”

The comments echoed those of the Governor of the Banque de France, who said that the ECB would respect its mandate as interpreted by the ECJ.

Report by Leigh Thomas and Michel Rose; Writing by Sarah White; Editing by Geert De Clercq and Kevin Liffey

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