Thursday, 26 October 2017

European Central Bank to halve €60bn bond buying programme



The European Central Bank (ECB) will cut back its scheme designed to boost the economies of the eurozone.

 
From January of next year it will reduce the amount of assets it buys every month to €30bn from the current level of €60bn.


The programme, which aimed to fend off the threat of eurozone deflation and help boost employment, could finish by the end of next year.


Inflation is likely to be below the 2% ECB target for the next few years.


The ECB said the reduced programme will run to the end of September 2018, "or beyond, if necessary".
If economic conditions become less favourable, or if no progress is likely to be made towards the ECB's inflation target, it could increase bond-buying again, it said.


ECB President Mario Draghi has been signalling for months that the bond-buying scheme will come to an end.


"Mario Draghi's main goal for months now has been to gently steer markets into thinking that this tapering would come today. He's done that so markets take the announcement in their stride, which they will," said Patrick O'Donnell, Aberdeen Standard Investments senior investment manager.




BBC      News.