'Whatever it takes' and the role of Eurozone news. Issue 16 (20th September 2018)

• Record Type: Journal Article
• Authors: Van Der Heijden, Minke; Beetsma, Roel; Romp, Ward
• Is Part Of: Applied economics letters. Volume 25:Issue 16(2018)
• Page Start: 1166
• Page End: 1169
• Publication Date: 2018-09-20
• Subjects: Eurozone -- news -- break test -- crisis -- 'Whatever it takes'; E58 -- E62 -- G12 -- G15 -- H63; Economics -- Periodicals; Economics, Mathematical -- Periodicals; 330
• DOI: 10.1080/13504851.2017.1403555
• Languages: English
• ISSNs: 1350-4851

Abstract

ABSTRACT: This letter shows that the 'Whatever it takes' speech by ECB President Draghi on 26 July 2012 and the ensuing installation of the Outright Monetary Transactions' framework are associated with a reduction in the domestic and cross-border effect of Eurozone news on absolute yield changes in Eurozone sovereign debt. These results are consistent with the popular view that these actions helped to avoid a collapse of the Eurozone.