The European Central Bank’s new policy package will have little effect on the euro zone’s coronavirus-ravaged economy, according to the forecasts of a Reuters poll of economists, who nearly halved their outlook for first-quarter growth. Despite the ECB’s decision to top up its pandemic emergency purchases by half a trillion euros to 1.85 trillion euros .
European Central Bank steps up its stimulus as the economy contracts bostonglobe.com - get the latest breaking news, showbiz & celebrity photos, sport news & rumours, viral videos and top stories from bostonglobe.com Daily Mail and Mail on Sunday newspapers.
The near term outlook remains abysmal, and the ECB will want to keep its focus on the short-term pitfalls until a clearer end to the pandemic is in sight, Societe Generale ECB watcher Anatoli Annenkov said in a research note.
Annenkov and SocGen expect an extension of the ECB s bond-buying program until December 2021, with an extra 600 billion euros in total, alongside a new financing program for banks.
While the vaccines may well be a game changer for the globe next year, the ECB seems to be erring on the side of caution. The so-called central bank of the central banks, the Bank of International Settlements, warned in its quarterly report on Monday about the risk of rising insolvencies.