ECB acknowledged in the monetary policy decision statement that risks are “clearly tilted to the downside” in the current environment. New round of macroeconomic projections tin December will “allow a thorough reassessment of the economic outlook and the balance of risks”. ECB will then “recalibrate its instruments” as appropriate.

For today, main refinancing rate is held at 0.00%, marginal lending facility rate and deposit rate at 0.25% and -0.50% respectively. Forward guidance is unchanged interest rates will “remain at their present or lower levels until it has seen the inflation outlook robustly converge to a level sufficiently close to, but below, 2% within its projection horizon”.

ECB will also continue the PEPP purchases with a total envelope of EUR 1350B “until at least the end of June 2021”. Net purchases under APP will continue at monthly pace of EUR 20B, together with the additional EUR 120B temporary envelop until the end of the year.

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Full statement here.


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