On Thursday, April 22, the ECB Governing Council, following the meeting, expectedly kept the base interest rate unchanged at 0.0%.
Key points of the ECB meeting
The Council expects the ECB’s key interest rates to remain at or below current levels until the inflation forecast stably approaches a level close enough to but below 2% within its forecast horizon.
The purchase of net assets under the Pandemic Emergency Procurement Program (PEPP) totaling € 1,850 billion will continue until at least the end of March 2022 and, in any case, until he believes the coronavirus crisis has receded.
Net purchases under the Asset Purchase Program (APP) will continue at a monthly rate of € 20 billion. The Governing Council still expects APP monthly net asset purchases to continue for as long as necessary to strengthen the regulatory impact of its interest rates, and end shortly before it starts raising key ECB interest rates.
The Governing Council stands ready to adjust all of its instruments accordingly to ensure that inflation continues to move towards its goal in line with its commitment to symmetry.
ECB President: Economic Growth Should Resume in Q2
During a press conference, the head of the ECB noted that vaccination supports expectations of a sustained recovery in economic activity. Inflation has accelerated, but underlying inflationary pressures remain low. Financial sector risks remain
Christine Lagarde highlighted the critical role that financial stimulus measures play in supporting activity in the Eurozone. Economic growth is expected to resume in Q2
Along with this, activity in the service sector is limited, but there are no signs of recovery so far. Downside risks remain in the short term. Headline inflation is likely to pick up in the coming months, with underlying price pressures going up this year.
As for the euro exchange rate, the head of the ECB said that the regulator will continue to monitor the situation in the foreign exchange market.
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