German parliament passes resolution backing ECB's bond buying

FRANKFURT, July 2 (Xinhua) -- German parliament (Bundestag) on Thursday passed a resolution saying that the European Central Bank (ECB) has met the requirements from a top German court concerning the bank's massive bond-buying program.

Germany's Federal Constitutional Court ruled in early May that the ECB's public sector purchase program (PSPP) launched in 2015 is partially unconstitutional.

The court has asked the federal government and the Bundestag to make sure that a proportionality check was done for the PSPP, otherwise the Bundesbank, Germany's central bank, may have to withdraw from the program.

The joint motion accepted on Thursday was proposed by Chancellor Angela Merkel's Christian Democratic Union and coalition partners -- the Social Democratic Party, the Free Democratic Party and the Greens.

"The requirements contained in the ruling of the Federal Constitutional Court to carry out a proportionality test in connection with the PSPP are met," said a statement about the joint motion on the parliament's website.

The ECB had examined the suitability, necessity and adequacy of the monetary policy measures in relation to its decisions on the PSPP, and the economic-political effects of the program were identified and weighted, it added.

ECB President Christine Lagarde and other officials from the central bank have previously repeatedly stressed that the ECB is under the jurisdiction of the European Court of Justice, which already ruled in 2018 that the program is in line with the ECB mandate. However, Lagarde also noted she is confident that a solution could be found.

Yves Mersch, member of the Executive Board of the ECB, said during a webinar on Thursday that Bundesbank President Jens Weidmann recently requested that the ECB authorize the disclosure of a number of documents to the federal government and the parliament.

"We authorized the disclosure of these documents on the condition that their non-public elements are treated confidentially," Mersch said.

Mersch also noted that the ECB's Governing Council constantly evaluates the potential side effects of its monetary policy measures, including the PSPP. "This evaluation is part of the proportionality assessment underpinning the ECB's policy choices and is publicly available," he said.