ECB to review make up of bond buys in green push, Lagarde says

FILE PHOTO: European Central Bank President Christine Lagarde testifies before the European Parliament's Economic and Monetary Affairs Committee in Brussels, Belgium February 6, 2020. REUTERS/Francois Lenoir/File Photo

FRANKFURT (Reuters) - The European Central Bank will review a key rule forcing it to buy corporate bonds in proportion of their outstanding amounts in light of the market’s “failure” to reflect risks related to climate change, ECB President Christine Lagarde said on Wednesday.

“In the face of what I call the market’s failures, (there) is also a question we have to ask ourselves as to whether market neutrality should be the actual principle to drive our... asset purchases programme,” Lagarde told a United Nations event.

“I’m not passing judgement on the fact that it should no longer be so, but it warrants the question and this is something that we are going to do as part of our strategy review.”

Reporting By Francesco Canepa; Editing by Alex Richardson