ECB Press conference
- Q2 forecasts in negative scenario point to -15% quarter on quarter decline
- ECB more determined than ever
- will make full use of flexibility embedded in PEPP and other policy tools
- Lagarde said ECB did not discuss APP at today's meeting
- PEPP might be extended beyond end of 2020 and is designed to address current crisis
- current tools allow ECB to act across the entire curve
- OMT (outright monetary transactions) not best suited for present contingencies
- ECB to publish PEPP (pandemic emergency purchase program) purchases by countries bimonthly
- ECB won't tolerate any risk of monetary fragmentation
- ECB did not discuss buying junk bonds in APP (asset purchase program)
- Did not discuss extending PELTRO (pandemic emergency longer-term refinancing operations) beyond banks, but not closing door to lending to nonbanks
- Actions by the ECB is intended for credit to flow
- banks are in a much stronger position than the last crisis
- ECB scenarios indicate uptick in growth in 2021
- ECB to publish economic scenarios tomorrow
- We will see significantly reduced inflation
Press conference ends at 9:34 AM ET/1334 GMT. Overall economic assessment was downbeat. The bank did not discuss junk bonds in the APP.
