Euro spikes after ECB drops promise to increase bond buying

Kept rates unchanged

Tom Eckett
clock • 7 min read

The euro jumped in early afternoon trading after the European Central Bank (ECB) removed commitments to increase its bond-buying programme but reaffirmed its loose monetary policy conditions by keeping interest rates unchanged.

Seen as a small step towards normalisation from the ECB's governing council after stimulus measures were implemented during the eurozone crisis, the Bank removed a paragraph featured in previous monetary policy meeting minutes, which said it stood "ready to increase the asset purchase programme in terms of size and/or duration" should concerns in the bond market rise. ECB President Mario Draghi said the reason for the statement removal "was a backward looking decision without signals or implications for either our expectations or reaction function". However, the ECB reiterated it will...

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