ECB to buy eurozone bonds to avert crisis from expanding

The European Central Bank said last night it will buy eurozone bonds in a bid to avert the crisis from widening, following emergency talks on the debt crisis.

The bank said it would start actively implementing its ''Securities Markets Programme'' to fight the euro zone's debt crisis but did not specify which bonds it would buy but most analysts expect them to be from Italy and Spain, countries now at the centre of the debt crisis.

''ECB will actively implement its Securities Markets Programme. This programme has been designed to help restoring a better transmission of our monetary policy decisions - taking account of dysfunctional market segments - and therefore to ensure price stability in the euro area,'' ECB said in a statement.

ECB said it welcomed announcements by Spain and Italy on new fiscal and structural policy measures, and urged both governments to swiftly implement it in order to rapidly reduce public deficits.

ECB welcomed the "decisive and swift" action taken by the governments in Rome and Madrid to cut their budget deficit.

Leaders of France and Germany also appreciated the action taken by Italy and Spain - the third- and fourth-biggest eurozone economies.