ECB’s Lagarde: Purchase Programs to Be Re-Examined Soon by the Governing Council

27 November 2023

By Isabel Teles – FRANKFURT (Econostream) – European Central Bank President Christine Lagarde on Monday said that the ECB would reassess its bond purchase programmes soon.

Answering questions before the Committee on Economic and Monetary Affairs at the European Parliament in Brussels, Lagarde said that accelerating the pace of the ECB's quantitative tightening was ‘a matter which will come probably for discussion and consideration within the Governing Council in the not-too-distant future and we would re-examine possibly this proposal.’

The ECB was currently reducing its balance sheet by stopping the net asset purchase programme and by letting securities on a run-off basis, she said.

‘In terms of other purchase programmes that we have undertaken particularly as a result of the pandemic, we have indicated that we would continue reinvesting until at least ’24’, she said.

The ECB was doing a review of its operational framework and would examine all the available options carefully, she said.

‘It’s a complicated matter which will give rise to multiple tradeoffs we view, and we are in the middle of this work, so this is very much work in progress’, she said.

‘What I can imagine is that it will produce a balance sheet the size of which will be definitely smaller than the peak that we have observed in the last couple of years’, she said. ‘And where I would imagine it would also be higher than what it was before the Great Financial Crisis.’