April 21, 2016 / 12:45 PM / 2 years ago

ECB to start buying corporate bonds in June

FRANKFURT, April 20 (Reuters) - The European Central Bank will begin purchases of euro zone corporate bonds in June, ECB President Mario Draghi said on Thursday.

Speaking at a news conference after the ECB left interest rates unchanged, Draghi said full details of the corporate bond purchase scheme would be given later on Thursday.

The ECB said last month it would start buying corporate bonds issued by companies that are based in the euro zone, have an investment-grade rating and are not banks.

Chief economist Peter Praet has said the ECB might follow a market index when choosing which corporate bonds to buy alongside government debt under its 80 billion euro ($90.58 billion) a month asset-purchase programme.

The plan has raised questions about the risks the ECB will take onto its balance sheet by buying unsecured private debt.

The beneficial impact of these purchases on inflation has also been questioned given the limited size of the euro corporate bond market and its tenuous tie to the broader European economy. ($1 = 0.8832 euros) (Reporting by John O’Donnell; Editing by Catherine Evans)

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