The European Central Bank has reported strong demand for an offer of unlimited three year loans. Banks were urged to take the funds to ease pressure on the eurozone financial system.
More than 500 European financial companies took €489bn worth of loans from the ECB’s longer-term refinancing operations, or LTROs.
Of course what are those banks going to do with loans priced at 1%. Most likely they will use it all to buy European government bonds yielding several hundred basis points more, in a straightforward carry trade.
That in turn allows the various European governments to raise the cash they need to back their recent IMF commitments.
So nothing really happened except cash flow from the ECB to the IMF via the banks and national governments. The banks make a spread, and you dear tax payer, will be picking up the tab.