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The European Central Bank STILL hasn't discussed extending QE

Oct 20, 2016, 19:17 IST

Business Insider

The European Central Bank has yet to discuss extending its current quantitative easing programme beyond its current end point of March 2017, President Mario Draghi said in a press conference in Frankfurt on Thursday.

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Speaking to reporters after the ECB left all its main rates unchanged - with its key refinancing rate remaining at 0%, and the key deposit rate left at -0.4% - Draghi denied that the bank's governing council had discussed a much-vaunted extension of quantitative easing.

This is something that has been on the mind of markets in recent months, given that it is now just five months until the programme is meant to come to a close.

The bank initially surprised markets at its September meeting by declining to extend the programme past the March 2017, and it continued to disappoint on Thursday, with another uneventful press conference from President Draghi.

Along with denying any discussion of extending QE, Draghi also categorically said that the council has not discussed tapering QE - essentially a gradual phasing out of its bond-buying programme before it officially comes to an end in March - saying, "we haven't discussed that. We haven't really touched on that discussion at all."

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Early in October, a report from Bloomberg suggested that the ECB will "probably gradually wind down bond purchases before the conclusion of quantitative easing, and may do so in steps of 10 billion euros ($11.2 billion) a month, according to euro-zone central-bank officials."

When asked about this report, Draghi described the information given by Bloomberg's source as "a random statement by someone who didn't have any clue or information about that." He later called talked of "unauthorised, and probably uninformed sources."

Draghi strongly hinted that the ECB could make some sort of move on a QE extension in December, saying that it will have access to new forecasts and papers from ECB staff by the last meeting of 2016: "Our decisions in December will tell you what we are going to do in the coming months. That will define the monetary policy environment for the coming weeks and coming months."

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