ECB Governing Council member Madis Muller said the central bank might not need to boost the crisis asset purchases. He said, “if in the second half economic growth in general recovers as the ECB forecasts and the inflation outlook doesn’t worsen additionally, then I think an additional increase in asset purchase program isn’t needed.”
He emphasized, “we have to remember that the pandemic emergency purchase program is meant as temporary, to get over the most acute phase of the crisis.” Also, “inflationary expectations for the near term are very low but I see this as a rather short-term risk that is also affected by the recent sharp decline in energy prices,” Muller also said.
Separately, another Governing Council member Peter Kazimir said the PEPP expansion as announced in the last meeting was to minimize deflation risks. “I wish we could talk about a specific date as to when to end it,” he added. “I wish it were as soon as possible.”
