BERLIN (AP) — A top European Central Bank official has indicated that a German court judgment against the bank's program to buy the bonds of troubled economies could reignite concerns over the future viability of the euro currency.
Germany's Federal Constitutional Court, the highest in the land, holds a two-day hearing starting Tuesday on the rescue fund the 17 European Union countries that use the euro have created in response to the debt crisis that has afflicted the region over the past few years. Critics contend that the fund, known as the European Stability Mechanism, violates German law.
Judges will also consider the ECB's offer last September to purchase unlimited amounts of government bonds, a policy that has been widely credited for an easing in Europe's debt crisis.
"When we announced the (bond-buying) program, the eurozone was close to an uncontrolled disintegration," ECB executive board member Joerg Asmussen was quoted Monday as telling Germany's Bild daily.
At that point, he said it was up to the ECB to make clear to speculators that "the euro will be defended."
"The program was economically necessary, legally admissible and efficient in terms of its effect," Asmussen said.
The ECB announced the program, dubbed Outright Monetary Transactions, after bank president Mario Draghi had pledged that "within our mandate, the ECB is ready to do whatever it takes to preserve the euro."
The offer to buy bonds issued by heavily indebted countries is conditional on their first asking for help from the eurozone's bailout fund.
Though no country has asked for assistance, the prospect of help has reduced tensions in financial markets and sent the borrowing rates of some of the eurozone's most indebted countries, such as Italy and Spain, sharply lower.
"If the (bond) buying program had to be withdrawn, that would have significant consequences," Asmussen was quoted as telling Bild. He did not elaborate.
Critics in Germany, which as Europe's biggest economy is the major contributor to eurozone rescue packages, argue that the ECB is exceeding its powers by offering to buy unlimited amounts of government bonds.
A ruling from the constitutional court isn't expected for several months.