UEUR - ECB instructs staff to create a 'new crisis tool' to combat fragmenting yields (update)

The European Central Bank is telling its staff to prepare a new tool to address fragmentation in yields in the eurozone. In a short statement Wednesday after an emergency meeting to address market turmoil the ECB also said it would reinvest Pandemic Emergency Purchase Programme funds to help stabilize yields. The central bank called the meeting as Italian 10-year bond yields topped 4%, increasing fragmentation, or the spread between eurozone countries. The 10-year Italian yield sank sharply after the meeting announcement, down to around 3.76%. But it has come off its lows after the statement and is now around 3.80%. The euro (NYSEARCA:FXE) has pared gains against the dollar, up about 0.1% to 1.0429. The STOXX 600 (STOXX) is up 1.7%, looking at its biggest gain in a month. "Not exactly a bazooka," economics lecturer Daniel McLaughlin tweeted. "The ECB called an emergency meeting this AM, so explicitly acknowledging that

For further details see:

ECB instructs staff to create a 'new crisis tool' to combat fragmenting yields (update)