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The European Central Bank (ECB) kept interest rates unchanged, but announced that it will reduce its monthly quantitative easing (QE) measures from €60bn to €30bn starting in January 2018.
The measures are scheduled to continue for nine months through to September of next year. The ECB confirmed that it would be willing to increase these stimulus measures if inflation remains more sluggish than anticipated.
In the accompanying press conference, ECB President Draghi struck a slightly cautious tone as he noted that inflation is yet to show convincing signs of a sustained pick-up and confirmed that the ECB’s key policy interest rates are likely to remain at current levels until “well past” the end of QE.
The sterling/euro exchange rate gave only a muted reaction to the initial policy announcement, but climbed towards €1.13 shortly after Mr Draghi’s comments.
The measures are scheduled to continue for nine months through to September of next year. The ECB confirmed that it would be willing to increase these stimulus measures if inflation remains more sluggish than anticipated.
In the accompanying press conference, ECB President Draghi struck a slightly cautious tone as he noted that inflation is yet to show convincing signs of a sustained pick-up and confirmed that the ECB’s key policy interest rates are likely to remain at current levels until “well past” the end of QE.
The sterling/euro exchange rate gave only a muted reaction to the initial policy announcement, but climbed towards €1.13 shortly after Mr Draghi’s comments.