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The European Central Bank has reaffirmed its decision to keep borrowing costs low in the eurozone, saying it will maintain the pace of recently increased bond purchases until it is firmly on the path to recovering the bloc’s economy.
The central bank maintained its major policy measures unchanged on Thursday. In a statement released after the decision, policy makers said “the input information confirmed the joint assessment of funding conditions and inflation forecasts made at the March monetary policy meeting.”
Therefore, “the governing council expects purchases [pandemic emergency purchase programme] to continue to do so at a significantly faster pace in the current quarter than in the first months of the year, ”the statement said.
The deposit rate remained at 0.5% and the ECB reaffirmed its seriousness that further programs to buy emergency bonds worth € 1.85 million could be expanded or not used in full, according to progress in boosting output and inflation.
The eurozone economy continues to suffer from the containment measures put in place to control high rates of Covid-19 infection in the bloc. But the pace of vaccinations has accelerated lately in many countries, and has boosted economists ’hopes of easing cuts next month, as many expect the rebound to be strong.
The most conservative members of the ECB’s governing council hope the economic outlook will be sufficiently clarified to justify a slowdown in the pace of bond purchases in the coming weeks when it publishes new forecasts in June, even if other board members consider this premature due to low inflation.
One of the main issues facing policymakers is discussing when to start the huge bond-buying programs launched by central banks around the world to deal with the economic shock of the pandemic.
Bank of Canada he said on Wednesday would increase the purchase of monthly bonds in response to an improved economic outlook. But the US Federal Reserve he said last month it was not yet ready to buy assets and reduce the Bank of England he said recently that he would end the bond purchase “towards the end” this year.
The ECB held its last meeting in March, he decided making the purchase of emergency bonds in the “second quarter” at a “significantly faster pace” to alleviate the risk of selling debt markets before the recovery takes off.
Since then, weekly net purchases have increased slightly, and analysts have been wondering if there has been a rebound in recent times. sovereign bond markets ECB officials changed their minds.
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