The European Central Bank’s sovereign bond-buying programme has been ruled legal by the European Court of Justice after the quantitative easing measure was legally challenged in Germany through multiple lawsuits.

Political and private stakeholders in Germany have argued that the ECB’s buying of sovereign bonds from countries like Greece, Spain, and Portugal was a form of sovereign burden sharing forbidden by the EU ‘s treaties.

The ECJ ruled that in its capacity as a buyer of law resort, the ECB was acting within its mandate.

“To exert an influence on inflation rates, the ESCB (European System of Central Banks), as a necessity, must adopt measures that have certain effects on the real economy,” the court said.

The ECB’s objective was to lower interest rates for sovereign bonds, thus easing the pressure on indebted EU members, which then allows firms to gain access to liquidity to restart the economy. As a result, quantitative easing ended deflationary pressure.

The ECB’s sovereign bond-buying programme is due to end later in December. A residual effect of the policy will still be felt, however, as the ECB will continue to invest proceeds from sovereign bonds into refinancing sovereign debt.