The ECB accelerates the pace of its purchases due to the increase in interest rates on public debt

The European Central Bank announced this Thursday that purchases under the anti-crisis tool (PEPP) during the next quarter will be carried out "at a significantly higher rate than during the first months of this year." The ECB will continue to make purchases with PEPP, with a total endowment of 1.85 trillion euros until at least the end of March 2022 and, in any case, "until it judges that the coronavirus crisis is over." Thus, "based on a joint assessment of financing conditions and inflation prospects, the Governing Council anticipates that purchases under the PEPP during the next quarter will be made at a significantly higher rate than in the first months of this year".

The ECB wants to avoid "a tightening of financing conditions that is incompatible with counteracting the impact of the pandemic on inflation." In any case, Lagarde announces that "the endowment can be recalibrated if necessary to maintain favorable financing conditions to help counteract the negative impact of the pandemic."

In addition, the ECB has decided to keep the interest rate unchanged, while waiting for them to remain at their current or lower levels until the inflation outlook "solidly converges to a level close enough to 2%, but below it, within of its projection horizon ".

Finally, the Governing Council of the ECB "will continue to provide ample liquidity through its refinancing operations, in particular the third series of specific longer-term refinancing operations (TLTRO III) continues to be an attractive source of financing for borrowers. banks, which backs bank loans to businesses and households. "