• ECB: "With contagions, you risk a longer crisis"

  • ECB, Lagarde: "Recovery depends on vaccinations and speed on Recovery Fund"

  • Lagarde: the ECB lowers the 2021 GDP estimate for the Eurozone to + 3.9%

  • ECB: "The withdrawal of the anti-crisis measures would block the recovery".

    "Italy and Holland most exposed"

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21 January 2021No monetary policy news came from the meeting of the Governing Council of the ECB, which decided to keep the interest rates on main refinancing operations, marginal lending operations and deposits with the central bank unchanged.

They will remain unchanged at 0.00%, 0.25% and -0.50% respectively.

The Eurotower communiqué underlines how the Council "has decided to reconfirm the very accommodative stance of its monetary policy".



Times and resources also confirmed for the purchases of the Pandemic emergency purchase program (Pepp) whose endowment in December had been increased to 1,850 billion euros with net purchases at least until the end of March 2022 "and , in any case, until the critical phase linked to the coronavirus is considered over ".



The ECB confirms the possibility of "recalibrating, if requested, the endowment to preserve favorable financing conditions that help to counter the negative shock of the pandemic on the inflation profile".



The Governing Council will continue to reinvest the redeemed principal on maturing securities under the Pepp at least until the end of 2023 while net purchases under the Asset Purchase Program (Paa) will continue at a monthly pace of € 20 billion.



The ECB reiterates that it is "ready to adapt all its instruments, where appropriate, to ensure that inflation continues to stably approach the target level, in line with its commitment to symmetry".



Lagarde: "Still strong risks for the eurozone economy"

Even if "the vaccination campaign represents an important milestone" in the fight against the coronavirus "the pandemic continues to pose serious risks to the economy with the resumption of infections and the prolonged lockdowns that are damaging the 'activities".

This was stated by the president of the ECB, Christine Lagarde, in the introductory statement of the press conference following the meeting of the Governing Council.

"Even if the manufacturing sector holds, the services sector remains very damaged" by the effects of the closures, he added.



"Risks still to the downside"

"The incoming data suggests that the return of the pandemic and containment measures will lead to a likely decline in the fourth quarter and will also weigh on the first quarter of 2021, but it is a scenario broadly in line with our macroeconomic estimates in December. The evolution has an uneven trend and the risks are still to the downside but less pronounced ", continued Lagarde.



"Recovery immediately operational"

The ECB is once again urging the States to exploit the "fundamental role of the Next Generation Eu instrument and underlines how important it is that it becomes operational without delay".

This was underlined by the president of the ECB, calling on "member states to use the funds for productive public spending, accompanied by structural policies aimed at improving productivity".

"This would allow the Next Generation EU program to contribute to a faster, stronger and more uniform recovery and increase the economic resilience and growth potential of the Member States' economies, supporting the effectiveness of monetary policy in the euro area. ".



"Ready to regulate all our instruments"

We are ready to regulate all our instruments, nothing will be left out "according to the financial conditions, he stresses while answering a question.



" Targeted and temporary fiscal measures "

" The fiscal policy measures adopted in response to the pandemic emergency should remain as targeted as possible and of a temporary nature ", says Christine Lagarde.



" Today no sovereign poses problems for financing conditions "

" Sovereign debt yields are an important benchmark for the ECB ", but at the moment "We do not see that any development in a particular yield poses a problem for financing conditions in the Eurozone.



" "Monetary accommodation"

The data held by the ECB shows that "a large degree of necessary accommodation remains necessary to support economic activity "and bring inflation close to the 2% target". 



Euro remains above 1.21 dollars after the ECB

The euro is little moved and remains above 1.21 dollars, after the ECB, which leaves its monetary policy unchanged and says it is ready to intervene and adjust all its instruments, if necessary .

The European currency changes hands at 1.2153 dollars and 125.71 yen.