: The president of ’s powerful Bundesbank has firmly rebuffed international demands for decisive intervention in the bond markets by the European to combat the debt crisis, warning that such steps would add to instability by violating European law.

Bundesbank president Jens Weidmann told the Financial Times that only politicians could resolve the crisis, and he rejected the idea of using the ECB as “lender of last resort” to governments.

He also criticised actions taken by eurozone governments as “inconsistent”, and warned that their plans to involve private sector banks in rescue plans for Greece could add to the eurozone’s woes. Such private sector involvement, he said, could undermine market confidence in the eurozone’s crisis-fighting tools such as the rescue fund, the European financial stability facility.

The forthright comments by Mr Weidmann, who is one of the most influential voices on the 23-strong ECB governing council, come at a decisive moment for Europe’s 13- year-old monetary union, which in recent days has seen Italy’s borrowing costs soaring dangerously and the prime ministers of both Italy and Greece resigning.

To prevent the crisis erupting into a global economic shock, the ECB has been urged to intervene directly by economists and politicians around the world, including at the weekend by Russia’s Vladimir Putin.

Mr Weidmann highlighted the stance being taken by the Bundesbank by arguing governments, not central banks, were mainly responsible for ensuring financial stability. , the ECB’s new president, has said it is not the ECB’s job to act as lender of last resort, but Mr Weidmann went further, saying such a step would breach Europe’s ban on “monetary financing” – central bank funding of governments.

“I cannot see how you can ensure the stability of a monetary union by violating its legal provisions,” Mr Weidmann argued. “I don’t see how you can build trust in a system that violates laws.”

Mr Weidmann said current Italian interest rates levels were “not such a big issue” in the short run. “What we are facing in Italy is an acute confidence crisis, and only the Italian government can resolve that crisis.”

Since May last year, the ECB has been buying eurozone government bonds – a move opposed by the Bundesbank – but sees its role as limited and aimed only at ensuring functioning markets. Mr Weidmann worried that repeated changes in eurozone plans for dealing with the crisis had simply undermined financial markets’ confidence. He also explained why he, along with other members of the ECB’s governing council, had expressed concern about Berlin-led attempts to secure a contribution from banks towards Greece’s bail-out costs – the so-called “private sector involvement”.

“PSI might appear an easy way out of self-inflicted problems. If this is the case, you achieve the opposite of what you wanted to achieve. You will have more contagion instead of containment of the crisis because it’s seen as a potential model for other countries.”

Mr Weidmann offered no clues on whether the ECB might cut interest rates further at its December meeting from the current 1.25 per cent. But he stopped short of reiterating past Bundesbank opposition to the ECB’s main interest rate falling below 1 per cent. “I won’t speculate about the future actions ... and limits to future action.”