ECB split is brewing on President Lagarde's signature crisis-fighting tool

European Central Bank President Christine Lagarde’s signature crisis-fighting tool is becoming the focus of disagreement among policymakers in what could amount to her first major test of discipline.

Governing Council members face a potential rift over how much their emergency bond-purchase program should stay weighted toward weaker countries such as Italy, according to multiple conversations with central-bank officials. While the debate remains hypothetical for now, it could crystallize as the economy emerges from the coronavirus pandemic. The danger is that such friction undermines a program unveiled at the height of the crisis to reassure investors of the ECB’s resolve in defending the integrity of the euro.

The officials asked not to be named because of the confidentiality of internal discussions. An ECB spokesman declined to comment. The internal mood is reflected in differing public comments by the central-bank heads of the euro zone’s two biggest economies: Germany’s Jens Weidmann and France’s Francois Villeroy de Galhau. 

Other Governing Council members hold similar views to them on either side of the debate, according to the officials.