The ECB expanded its Pandemic Emergency Purchase Programme (PEPP) by €600 billion and extended its horizon to at least the end of June 2021. The news pushed bond yields lower and strengthened the EUR, analysts at Nordea inform.
Key quotes
“The size of the PEPP was increased by €600 billion to a total of €1350 billion, slightly higher than most were expecting.”
“The horizon of the net purchases under the PEPP was extended to at least the end of June 2021 and in any case until the coronavirus crisis phase is over.”
“The maturing principal payments from PEPP will be reinvested until at least the end of 2022.”
“The financial markets showed mostly a positive response to the package. The news pushed bond yields lower and narrowed intra-Euro-area spreads, while equity prices and the EUR rose.”
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