ECB’s Stournaras: No Reason to Make Any Change Now to Pace of PEPP Purchases

25 May, 2021

By David Barwick – FRANKFURT (Econostream) – There is no evidence calling for a change in the European Central Bank’s asset purchases under its pandemic emergency purchase programme (PEPP), ECB Governing Council member Yannis Stournaras said Tuesday.

In an interview with Reuters, Stournaras, who heads the Bank of Greece, said, ‘Of course, there has been an acceleration in vaccinations but there are still travel restrictions so I cannot say we are out of the woods yet.’

As for the pace of asset purchases being conducted under the pandemic emergency purchase programme (PEPP), ‘I don’t see any reason to make any change at the moment,’ he was quoted as saying.

The time is not right to wind down PEPP, he said, suggesting that such a winding down would be more of a switch to another programme of asset purchases. ‘I don’t think the time is right to do this shift yet. Of course, at some point in the future this will occur, there’s no doubt about that. We have to think about a smooth transition from PEPP to APP.’

There is ‘no evidence’ of a ‘new era’ with respect to inflation, he said. It is so that as the pandemic is overcome, ‘supply-side bottlenecks make their appearance, but this is expected to smooth out over time.’