(Bloomberg) -- The European Central Bank will scrap limits on bond purchases for its 750 billion-euro ($819 billion) emergency program in a landmark decision that gives it almost unlimited firepower to fight the economic fallout from the coronavirus.

In a legal document released late on Wednesday, the ECB said the so-called issue limits, which constrained government bond-buying to a third of each of its member state debt, “should not apply” to its new emergency program.

Government bonds across the euro area rallied. Short-dated Italian debt saw the biggest gains, with two year yields dropping as much as eight basis points to 0.37%, the lowest level in a week. German 10-year yields fell five basis points to -0.31%.

“The Eurosystem will not tolerate any risks to the smooth transmission of its monetary policy in all jurisdictions of the euro area,” according to the document.

The emergency program, scheduled to continue until at least the end of 2020, will also include bonds with shorter maturities than under its ongoing quantitative-easing operations.

The dramatic move tallies with President Christine Lagarde’s comment that there are “no limits” to the ECB’s commitment to the euro.

The Governing Council agreed the Pandemic Emergency Purchase Program in an emergency late-night conference call a week ago. The legal details had to be finalized before it could be launched.

German, Italian Bonds Open Higher as ECB Suspends Issuer Limits

Frederik Ducrozet, global strategist at Bank Pictet & Cie. in Geneva, said the details are a bombshell and a game-changer for the ECB.

“In a nutshell, the decision removes virtually all constraints on asset purchases, in a further boost to the credibility of the ECB’s commitment,” he said in a note. “Asset purchases can now continue well into 2021, if needed.”

While the ECB is set to funnel more than 1.1 trillion euros into the 19-nation economy this year, its scope for purchases has been plagued by concerns it could run into self-imposed limits that would stop buying in its tracks. Some of the Governing Council member have also opposed easing of the constraints, arguing it would amount to the ECB bankrolling governments.

The euro-area economy is facing the biggest crisis in its history as restrictions imposed to limit the spread of the virus push activity into a standstill.

(Updates with market reaction in third paragraph)

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