The European Central Bank wants more scope to unleash monetary stimulus even as it heads toward unwinding it.An account of the Governing Council’s July meeting released on Thursday shows that officials are still uncertain how to signal changes in their policy settings as the economic outlook improves and the need for broad-based bond purchases lessens. Reaching a consensus is critical if they are to avoid missteps as the institution enters a new phase of its multi-year battle to avert deflation and restore euro-area price stability.Some policy makers signaled they are anxious to press ahead with adjusting the ECB’s forward guidance to avoid a “misalignment” between communication and the assessment of the economy, while others were looking for an insurance should the situation worsen. They argued for “more policy space and flexibility” to adjust stimulus “if and when needed, in either direction” in response to any overreaction to economic improvements in financial markets.
Source: ECB Searches for Stimulus Flexibility as End of QE Approaches – Bloomberg
This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.