ECB's Draghi defends euro rescue measures

(BRUSSELS) - European Central Bank chief Mario Draghi defended on Monday controversial measures taken to tame the eurozone debt crisis, including buying up government bonds, European MPs said.

MEPs said Draghi, widely expected to announce further details on Thursday of how the ECB will ease the pressure on struggling eurozone states, told them that the central bank had a responsibility to intervene when necessary.

Draghi, who made no public comment, said that buying government bonds of up to 3-year maturities on the secondary market did not amount to bailing out spendthrift euro members -- a charge levelled by many German politicians.

ECB bond buying in the past was justified, he said according to MEPs who spoke after his briefing, to help stabilise and protect the 17-nation eurozone.

French MEP Jean-Paul Gauzes said Draghi felt "that buying up medium-term (bonds) on the secondary market did not amount to creating money.

"A German MEP expressed his astonishment at such a statement," Gauzes added.

Data showed earlier Monday that the ECB has not bought government bonds for the past six months after it intervened massively from 2010 via its Securities Market Programme (SMP) to help debt-wracked eurozone countries.

The SMP has been dormant since February following the ECB's moves to pump more than one trillion euros ($1.25 trillion) into the banking system via three-year funding operations in December and February.

There is widespread speculation the ECB could be preparing to reactivate the SMP after Draghi said last month it "may" resume bond purchases, albeit under strict conditions that are still in the process of being worked out.

On the issue of European banking supervision -- a key part of greater bloc economic and policy coordination -- Draghi said the ECB would not take powers away from the current London-based European Banking Authority.