The European Central Bank is expected to extend its trillion-euro bond-buying program beyond March 2017 and announce to expand the universe of eligibile bonds as part of its seemingly never-ending struggle to kickstart the euro zone’s economy.
The central bank and its President Mario Draghi has been trying to push inflation back to its goal of below but close to 2 percent with a plethora of measures and instruments ranging from negative deposit rates to spur lending, a quantitative easing (QE) program that has been buying 80 billion euro ($89 billion) in bonds every month and interest rates close to zero – but without a breakthrough success.
Analysts believe the ECB’s governing council has its work cut out when it meets to decide on monetary policy Thursday. The headline rate of inflation remained unchanged at 0.2 percent in August. Core, or underlying inflation, which excludes energy, goods, alcohol and tobacco, fell from 0.9% in July to 0.8%, according to Eurostat.