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German court to assess legality of ECB's bond-buying scheme

A hearing at Germany's Constitutional Court will determine whether the European Central Bank's (ECB's) bond-buying programme - which was launched last year - was legal.

Thousands of complaints have been made about the Outright Monetary Transactions (OMT) project and judges will decide today and tomorrow (June 11th and 12th) if the initiative was above board.

With an array of eurozone countries, including Greece, Italy, Spain and Cyprus, falling on hard times, the ECB was desperate to do all it could to ensure the single currency did not collapse.

It decided that an unlimited bond-buying programme was the best way to protect ailing members of the euro area and it was successful in driving down soaring borrowing costs for struggling nations.

ECB board member Jorg Asmussen is adamant the OMT solution was entirely necessary, as the eurozone was on the brink of disaster.

He told Bild: "At this time the ECB was the only European institution capable of taking action and it had to make clear to speculators, 'Do not mess with the ECB'."

By Asim Shah