According to Martins Kazaks, a member of the Board of the European Central Bank, who spoke to Bloomberg, the European Central Bank could consider lowering its emergency bond purchase program next month, if the euro zone economy does not deteriorate. The new estimates, which the ECB will update at its June meeting, will provide new information on how long the economy will take to recover and whether upward price pressures are settled. Policymakers say that, the same as Fed members, increases have largely reflected temporary factors, while inflation rates in the euro area have risen in recent months.
Some important points;
· ECB may not use all of PEPP.
· We will not react to all increases in market rates.
· Risks to the economic outlook are now shifted upwards.
· It’s early to talk about getting out of the pandemic program.
· If inflation is weak, discuss increasing APP after PEPP.
First, a better prototype BOE slowed down the rate of bond purchases, followed by a tapering signal from within the ECB. The early action scenes of major non-Fed central banks show that there is a monetary policy route to react to the economic recovery. If the rates will increase in the near future, it will be predicted that the central banks will move faster in the phase of drawing excess liquidity from the market. It is possible that Europe’s improvement will put the ECB into action earlier than envisaged. June seems critical in terms of the actions and predictions of major central banks. If implications have been made for this long time that the US economy is recovering faster; Markets will expect the tapering announcement more from the Fed.
Kaynak Tera Yatırım
Hibya Haber Ajansı
Kaynak: Hibya Haber Ajansı
