will be once again the prospects for sovereign debt of the peripheral countries the focus of central bankers in the Euro 13 when they meet Thursday in Frankfurt. Shall not, however, expectations of interest rate decisions, which should remain stationary at 1% for the twentieth consecutive month. In particular, the situation will be in Portugal to be examined with greater care in the light of the tensions that have surrounded the Lusitanian debt securities during the first sessions of the year. During recent weeks, in fact, the Portuguese government to ten years have approached in a decisive manner, surpassing it in many occasions, the critical threshold of 7%, which marked the deterioration of the situation in Greece and Ireland, both countries were forced to require the coordinated action of European Union and the International Monetary Fund once their long-term yields had risen above 7%, making debt financing too expensive. The same Texeira Portuguese Finance Minister has repeatedly stressed that yields above 7% would be hardly bearable by his country. Hardly auctions of securities at 3 and 9 years on the calendar today should be able to bring about the peaceful markets, especially in light of the limited amount of equivalent value: between 750 million and 1.25 billion from 20 billion market that analysts estimate will be collected in 2011.
The debate within the ECB should be primarily focused on the continuation of the purchase of government bonds over the next month after market intervention by monetary authorities in Frankfurt have intensified in recent weeks: the value of the securities purchased is, in fact, rose to EUR74 billion from EUR63.5 billion in mid-November in the wake of the tensions that have covered the debt securities of all the peripheral countries. The decrease in securities purchased for EUR113 million in the week up to January 10 from EUR164 million the previous year and from EUR1121 million during the last week of 2010 may, however, be regarded as a sign of the unwillingness of the ECB to give more purchases under the program. That some members of the Board of Directors, among which the president of the Bundesbank Axel Weber, have always been skeptical of the purchase of government bonds is not, moreover never been a mystery. Significant new developments on this program, however, should not emerge, as well as with reference to the extraordinary refinancing that had been confirmed through the first quarter of this year last December.
At a press conference following the meeting the ECB President Trichet should remind governments decision to implement those measures necessary to bring the public finances in order and avoid a worsening of the situation on the markets, in line with the harsh tone used in the Last Friday, the Congress of the German CSU. This call should come as a warning to politicians that support the countries of the ECB and the banks in difficulties may soon fall.
Over the coming months, in fact, the ECB might have to return to deal with higher inflation, which we have already had the first signs during the month of December: according to Eurostat's flash estimate, in fact, consumer prices showed an increase of 2.2% y / y in the last months of 2010, the highest since January 2009. As the price increase should be mainly due to the leap in commodity prices, it is difficult to imagine that the ECB may decide to further increase market liquidity, in light of the signals coming from movements in the money supply M3. The growth rate of M3 money supply has in fact accelerated to 1 .9% y / y in November, as well as credits to the private sector. Only an increase in core inflation, 1 .1% y / y in November, but may alarm the ECB.
In short, investors expect the ECB to support new market could soon be very disappointed.
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