Today we will take a look at what’s been happening to the ECB’s balance sheet.
The data is here:
Here we can see the ECB’s buying of eurozone government bonds. This has already “tapered” somewhat. Yields have been rising somewhat worldwide as central banks pull back from their asset purchases. It will be interesting to see what happens to the eurozone’s more troubled credits as this takes place … or whether it will take place. Martin Armstrong has been saying that we will have a sovereign debt crisis beginning to bloom before the end of 2018.
Most of this has gone into bank reserves, not surprisingly. Later, I’d like to do an analysis of banks’ balance sheets, as I did last year for Japan.