The European Central Bank should not buy Spanish and Italian debt because it "makes no sense" and will take away the pressure on politicians to act, Belgium's central bank governor has said.

Luc Coene told Belgian newspapers De Tijd and L’Echo that buying the bonds of these countries would only serve to weaken the ECBand do nothing to resolve underlying issues of competitiveness.

“It makes no sense for the ECB to start financing those countries,” said Mr Coene, “It would only lead to the ECB taking on the whole public debt of Spain and Italy onto its balance sheet," he said.

"That would in turn weaken the ECB and do nothing to resolve the underlying problems."

Mr Coene also said that the central bank's efforts to calm markets last summer with around €135bn of additional debt purchases on the secondary market via its Securities Markets programme took away the pressure on politicians to act.

“We haven’t forgotten what happened in August of last year: We bought Italian bonds and right after that the Italian government reneged on its pledges," he said.

“The conclusion is clear: When you take away the market pressure, you take away the pressure on politicians to act.”

Spanish and Italian borrowing costs edged up on Friday, following a week of steady falls on hopes that Spanish PM Mariano Rajoy would make a formal request for EU aid, which would then trigger action from the ECB.

President Mario Draghi initially disappointed markets at his monthly press conference by reiterating that "the ECB cannot replace governments," and that countries would have to request assistance from the European Financial Stability Facility (EFSF) before the ECB could step in.

"Even if we were ready to act now, there would not be the grounds for doing so," he said.----

Source: http://www.telegraph.co.uk/finance/financialcrisis/9468862/Debt-crisis-ECB-buying-Spanish-and-Italian-debt-makes-no-sense-says-Belgian-bank-governor.html