Again, no real consensus on the ECB’s policy

Following ECB top chiefs’ latest press conference, some analysts thought that the ECB signaled the accommodative monetary policy (QE) will be ending while some other analysts said the ECB just opted for business as usual, meaning a smooth continuation of the QE.

“Based on our regular economic and monetary analyses, we decided to keep the key ECB interest rates unchanged,” said Mario Draghi, President of the ECB, in his introductory statement. Then, Draghi announced that the asset purchase program (APP) would decrease from EUR 80 billion to EUR 60 billion per month from April 2017 till the end of the year.

First, the consensus emerged that Draghi confirmed expectations about ECB’s interest rates policy. Then, a number of analysts wondered whether the 25% decrease in monthly APP would start the gradual ending process of the whole program, raising fears that it could impact Europe’s financial markets negatively in addition to impending political risk. This de facto absence of consensus among analysts came as expectations for a rate hike in March 2017 by the Fed kept growing.