Summarize:
* ECB to cut bond buying program to 30 billion euros per month from 60 billion, starting January
* QE could be extended beyond September 2018, if necessary
* No change in rates
The European Central Bank (ECB) decided Thursday to cut the level of bonds it purchases every month, but extend the length of time that its stimulus program runs.
Its purchases will fall to 30 billion euros ($35 billion) from 60 billion euros, starting in January. The central bank said it will extend its monetary stimulus program until at least September of next year.
The central bank has remained ultra-accommodative in the years since the global financial crash and the euro zone sovereign debt crises. As well as record low interest rates it also introduced U.S.-style quantitative easing (QE) — buying assets to stimulate lending — which is used to stoke inflation and boost the economy.
"Today's decision is a sea change but a very gentle one; not a big-bang u-turn in ECB monetary policy," Carsten Brzeski, a chief economist at ING, said in a research note.
"In fact, the QE recalibration the ECB has announced illustrates that the ECB wants to start the exit as cautiously as possible, ideally without seeing the euro appreciate or bond yields increase. It is a very dovish tapering."
At a subsequent press conference, Draghi explained that this recalibration of asset purchases reflected growing confidence in reaching the bank's inflation target, while also acknowledging that the economic outlook and the path of inflation remain conditional on continued support from monetary policy.
Draghi told reporters on Thursday that the decision wasn't unanimous. "The discussion ranged from consensus on general principles to a large majority on (certain decisions)," he said.
Reference: CNBC
Read More: https://www.cnbc.com/
Thai
Eng