Market Data 
By Balazs Koranyi
LONDON (Reuters) – The European Central Bank’s chief economist played down on Monday the need for the ECB to come to France’s rescue by buying bonds, saying recent market turmoil fuelled by political uncertainty was not “disorderly”.
French financial markets endured a brutal sell-off late last week as investors cut their positions ahead of a snap election that might give a majority to the far right. That has led some analysts to speculate that the ECB might intervene.
But Philip Lane said the latest market moves did not fulfil one of the key conditions for ECB intervention, that is that a rise in risk premiums is disorderly and unwarranted.
“What we are seeing in the markets is a repricing but it is not in the world of disorderly markets right now,” Lane told a Reuters NEXT Newsmaker interview at the London Stock Exchange.
Lane did not directly address the situation in France but he said all euro zone governments needed to comply with the European Union’s fiscal framework and engage in a dialogue with the European Commission.
Marine Le Pen’s eurosceptic National Rally (RN), which leads in opinion polls, is calling for a cut in the state pension age, energy price reductions, increased public spending and a protectionist “France first” economic policy.
French Finance Minister Bruno Le Maire has warned the euro zone’s second-biggest economy would be at risk of a financial crisis if the far right wins in the election, to be held on June 30 and July 7.
ECB sources told Reuters at the weekend they had no plan to discuss emergency purchases of French bonds, and that it was for politicians in Paris to reassure investors.
The ECB’s Transmission Protection Instrument (TPI) allows it to buy unlimited amounts of bonds from a euro zone country that finds itself under market pressure, but only if it is complying with parameters including the EU’s fiscal rules.
