ECB focuses on bank credit, bonds in gauging financing conditions: Lane By Reuters

FRANKFURT (Reuters) – The European Central Bank focuses on bank credit conditions and bond markets when assessing if financing conditions remain favourable, ECB chief economist Philip Lane said in a speech on Monday.

ECB President Christine Lagarde renewed a commitment to maintaining “favourable” financing conditions last week but did not say what measures were being looked at and sources close to the discussion said policymakers could not agree on what gauges to focus on.

“Naturally, the focus on credit conditions in the banking system on the one side and the bond markets on the other is consistent with the main methods used by central banks in steering financing conditions,” Lane said.

“The ECB routinely looks at a wide range of measures … with a prominent focus on the conditions facing customers who depend on bank-intermediated credit, as well as the conditions facing sectors which seek to obtain funding in bond markets,” he added.