Rules, discretion and market stabilisation in the euro area

This paper assesses the European Central Bank’s country-specific market-stabilisation instruments (SMP, OMT, PEPP flexibility and TPI) with a focus on the balance between rules and discretion in their design and use. While this study does not aim to provide an overall assessment of these instruments, it examines the clarity of access criteria, the impact of ambiguity in shaping market expectations, and the extent to which deployment of these tools has succeeded in reducing sovereign stress and thereby safeguarding monetary policy transmission. This document was provided by the Economic Governance and EMU Scrutiny Unit at the request of the Committee on Economic and Monetary Affairs (ECON) ahead of the Monetary Dialogue with the ECB President on 3 December 2025.