ECB Leaves Monetary Stimulus Unchanged Amid Surging Inflation
October 28 2021 - 7:28AM
Dow Jones News
By Tom Fairless
FRANKFURT--The European Central Bank said it would keep its
large monetary stimulus unchanged, delaying a decision on whether
to phase out easy money in response to surging inflation as global
supply-chain bottlenecks and shortages weigh on the region's
recovery from the Covid-19 shock.
While the eurozone economy has grown briskly in recent months as
governments dialed back social restrictions, the region's economic
output is only expected to return to its pre-pandemic level in
early 2022, up to a year later than the larger U.S. economy.
The ECB said in a statement that it will hold its key interest
rate at minus 0.5% and continue buying bonds under a 1.85 trillion
euros ($2.146 trillion) asset-purchase program at least through
March 2022. The bank said it would continue to buy bonds at a
"moderately lower pace" in the last months of this year than in the
previous six months, echoing a decision announced at its last
policy meeting in September.
Its decision to stand pat suggests that the ECB will lag other
major central banks including the Federal Reserve in phasing out
its pandemic stimulus policies even as eurozone inflation hits its
highest level in more than a decade.
Write to Tom Fairless at tom.fairless@wsj.com
(END) Dow Jones Newswires
October 28, 2021 08:13 ET (12:13 GMT)
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