Polish central bank may buy bonds if crisis worsens

Poland's central bank may buy the state's bonds in the secondary market if yields rise sharply on the back of a panic or a crisis, Finance Minister Jacek Rostowski said on Monday. "If (bonds) yields rise because of panic or on the back of a (crisis) contagion from the outside, not on the back of a bad managing of public finances, it could be advisable that the central bank could intervene (on bonds) in a short-term," Rostowski told weekly Newsweek in an interview.
Poland used state-owned bank BGK to intervene in the debt market last September, buying bonds in a move that soothed nervous markets and sending yields on longer-dated papers several basis points lower. The yield on Polish 10-year paper hovers around 5.88 percent, well below that of countries' from the eurozone periphery, which have seen borrowing costs soar in the past year as the region's sovereign debt crisis deepens.