* Germany’s top court was due to issue ruling
* Open-ended buying warrants new hearings: Kerber
FRANKFURT, Oct 8 (Reuters) - A group of conservative German academics sought on Tuesday to reopen hearings in a court case against the European Central Bank’s main stimulus tool after the ECB unveiled plans to buy bonds indefinitely.
It was the latest challenge to a quantitative easing (QE) programme that has driven a rift among ECB policymakers and was one likely reason behind the resignation of Germany’s appointee to the central bank’s board, Sabine Lautenschlaeger.
Germany’s constitutional court was due to issue a verdict on the ECB’s original, 2.6 trillion euro ($2.9 trillion) bond purchases, with analysts expecting a favourable ruling after the scheme was cleared by the European Union’s top court last year.
But German economist Markus Kerber and his fellow complainants argued the ECB’s decision last month to resume purchases and carry them out “for as long as necessary” warranted new hearings. “In view of the ECB’s decision to resume net bond purchases for an indefinite period from 1 November 2019, the facts of the matter have to be discussed again,” Kerber, a Berlin-based attorney and professor of public finance, said in a statement.
An ECB spokesman declined to comment.
Kerber cited a public warning from a group of former euro zone central bankers, including Germany’s Otmar Issing and Juergen Stark, as further evidence that the programme was “absurd and beyond the jurisdiction of the ECB”.
Kerber’s group had complained the QE scheme jeopardised German taxpayers’ money and unduly shielded indebted euro zone governments from pressure on the debt market.
Germany’s constitutional court in Karlsruhe could potentially order Germany’s Bundesbank - which as the central bank of the euro zone’s biggest economy carries out the largest share of the ECB’s bond buys - not to take part in new purchases.
But the likelihood of that had been seen as low after the European Union’s top court, the highest authority in cases against EU institutions, last year approved the ECB’s previous bond-buying programme. ($1 = 0.9110 euros) (Reporting by Francesco Canepa; Editing by Susan Fenton)
Our Standards: The Thomson Reuters Trust Principles.