London — Bonds from vulnerable eurozone governments, such as Portugal and Italy, were in demand on Thursday as the European Central Bank (ECB) prepared to dispense the final instalment of cheap, long-term bank loans that have been running for more than five years. Investors appeared to be anticipating solid demand for the cash with the ECB also set to trim the amount of money it pumps into the financial system by cutting monthly bonds purchases from April from €80bn ($86.25bn) to €60bn. "The driving force for the market reaction is the extra liquidity provided to the market, as investors see it as ... more money that can be invested into bonds or for lending," Mizuho strategist Antoine Bouvet said. "This scheme is high up on the list of things that can be re-introduced if conditions sour again." The consensus among money market traders polled by Reuters was for a take-up of €125bn although forecasts ranged widely from €50bn to €300bn. The net amount will be reduced slightly with €16...
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