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The European Central Bank’s (ECB) Governing Council noted that it was possible that the pandemic might have longer-lasting effects both on the demand side and on the supply side, the ECB’s November Monetary Policy Meeting Accounts showed on Thursday.

Market reaction

The EUR/USD pair pushed lower on this publication and was last seen losing 0.23% on the day at 1.1885.

Key takeaways as summarized by Reuters

“It was observed that headline inflation was now expected to be in negative territory for longer than had been foreseen in the September ECB Staff Projections.”

“Governing council is in a position to act at any time if needed.”

“Questions were raised about possible side effects and diminishing returns.”

“Employment is expected to contract further and a large share of jobs was at risk.”

“It was cautioned that the governing council should not pre-commit itself to specific policy actions.”

“The flexibility embedded in the PEPP is essential to its continued success.”

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