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Today, the European Central Bank (ECB) is set to announce its Interest and Deposit Rate Decision at 11:45 GMT. The market consensus is the ECB to stay on hold and as we get closer to the release time, here are the expectations as forecasted by the economists and researchers of eight major banks, regarding the upcoming ECB meeting. Most of the economists and researchers are expecting an increase of around €500 billion to the Pandemic Emergency Purchase Programme (PEPP).

Capital Economics

“Policymakers have signalled their intention to further expand the PEPP at the monetary policy meeting next Thursday. At a minimum, we think they will add a further €500 billion to this programme, bringing the total to €1,250 billion. They are also likely to state that they expect to continue with net purchases under the emergency programme until at least mid-2021 and to reinvest maturing principal payments for a significant period beyond that.”

Danske Bank

“We expect the ECB to expand the PEPP envelope by €500 billion into June 2021 at next week’s meeting. We do not expect new asset classes to be added at this stage. We also expect an extension of the €20 billion/month ‘normal’ APP, but no additional APP envelope when the current €120 billion ends in December this year. We do not expect an announcement on the potential PEPP reinvestment strategy next week.”


“We believe the ECB is ready to ease monetary policy again at next week’s Governing Council meeting: this time by raising the PEPP by 500 billion to 1250 billion and possibly even signalling that the purchases will not end by December 2020. […] Even higher bond purchases should cement the low-yield regime further and compress intra-Euro-area bond spreads.”


“We expect the ECB to increase the PEPP by some €500 billion at next week’s meeting to extend the programme to mid-2021. The ECB could also decide to include so-called ‘fallen angels’ into the programme, announce that the proceeds from PEPP will be reinvested, and could take another look at the tiering system. In the end, the ECB will have to balance doing more now (perhaps with one last big push) with continuing speculation about its ability and willingness to do more in the future.”


“We expect the ECB to increase the size of the PEPP by €500 billion, in line with consensus expectations. The unprecedented growth downgrades actually argue for an even larger programme. In addition, we expect the ECB to announce an expansion of buying to include fallen angels as a way to get in front of potential pressures as more downgrades roll through over the summer. Finally, we expect confirmation that PEPP purchases will be reinvested, with the timeframe left open for now until the size of the shock is clear to let them calibrate correctly.”


“The ECB is likely to announce a €250 billlion addition to PEPP in addition to a 10 bps cut in the discount rate. Although a headline regarding a rate cut could cause the EUR to wobble, in the current environment investors are more likely to see further policy action as more reason to plough more money into peripheral assets, which could bring some support to the EUR.”


“We expect the ECB to expand PEPP by €500 billion and to continue asset purchases until at least the middle of next year in response to another downgrade of their staff forecasts.”

Deutsche Bank

“Our economists expect that the €750 billion PEPP announced in March will be doubled in size to €1.5 trillion and extended to mid-2021. They also expect large downward revisions to the staff forecast which may give them cover to act further, with President Lagarde having already indicated that their forecast is between the ‘middle’ and the ‘severe’ scenarios the ECB had previously discussed, implying GDP growth this year between -8% and -12%. The other interesting aspect to watch out for today will be how Lagarde responds to questions on the German constitutional court ruling, which challenged the ECB’s previous public sector purchase programme in a court ruling last month.”