DislikedCan someone explain this sterilization procedure and how it affects the market?
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The ECB buys bonds, on secondary markets only by mandate, it then has to take that money supply out of the market within a week, again as per mandate as it is not allowed to print money, so it auctions deposits for commercial banks to use at a decent rate to take the same amount of money out of the system within a week equal to the bond purchases the week prior.
This is now the 3rd time this year that the desensitising process (as it is called) has failed.