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ECB will wait until December to take action

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(Kitco News) - ECB have had to consider some tough decisions as Germany and France move into lockdown. As expected all three rates were not changed. Prior to the meeting, it was expected that the ECB will ease further in December and will hold off today. The further economic issues would strengthen the case for the dovish members of the ECB. 

Key headlines from the ECB:

  • As expected no change in rates.
  • Current risks are tilted to the downside.
  • ECB leaves PEPP envelope at 1.35 trillion euros.
  • ECB to continue PEPP at least until June 2021
  • The ECB will also continue to invest proceeds from bond-buying even when the first rate hike is made.
  • Will wait until 9-10th December meeting to take action.
  • December forecasts will allow recalibration of stimulus.
  • ECB will run QE until shortly before rates rise.

Leading into the announcement from the ECB the US posted a decent monthly GDP reading and initial jobless claims figure for the week.  US GDP for Q3 came in at 33.1% vs exp 31.0%. and this sent the index futures higher leading into the ECB announcement. 

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