Little scope for interest rates: ECB decision in the afternoon: Will the ECB step up its billions in aid in the corona crisis? | message
In addition to the existing securities purchase program, the ECB had budgeted EUR 750 billion for the purchase of government and corporate bonds as part of the Pandemic Emergency Purchase Program (PEPP) in March. According to previous planning, the program should run at least until the end of this year. Given the high pace at which the ECB is currently buying securities, the 750 billion euros should be exhausted in autumn.
Securities purchases help states and companies alike: they do not have to offer such high interest rates on their securities if a central bank is a major buyer on the market. During the crisis, states launched billions of euros in rescue packages, which put a strain on households. In contrast, the ECB has relatively little scope for interest rates. The key interest rate in the euro area has been at a record low of zero percent for four years now.
/ mar / ben / DP / zb
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