ECB’s Stark steps down over bond-buying programme
European Central Bank (ECB) executive board member Jurgen Stark is to step down as conflicts over the bank’s bond-buying programme continue.
The move will make Mr Stark, who is Germany’s top representative on the board, the second policymaker from that country to leave the board after Bundesbank boss Axel Weber quit in February.
The decision reflects growing tensions amongst board members on how to solve Europe’s debt crisis.
Mr Weber also stood down because he was opposed to the costly bond-buying programme.
His decision was first reported by Reuters but ECB officials confirmed the move saying it was for personal reasons.
But it will mark a blow to the ECB which is losing its current president Jean-Claude Trichet who will retire in October.
He is being replaced by Italian Mario Draghi.
Analysts described the move by Mr Stark as “remarkable.”
The ECB revived the bond-buying programme recently to help drive down borrowing costs in Italy and Spain.
But the bank fears that by buying up Italian bonds it is only given the Government there the chance to play a long game in fixing its finances.
The euro fell and stocks tumbled both in Europe and on Wall Street on the unexpected news and ongoing fears that Greece will default on it mountain of debt.
The Dow Jones and Nasdaq were both off nearly 3pc shortly after his resignation was confirmed while the euro also fell.
But Greece is also weighing on investors’ minds.
Credit-default swaps used to manage the risk of default arising from holding debt showed a 94pc chance Greece will default.