The European Central Bank’s (ECB) are due to hold a meeting this week, where plans for discussion include an interest rate announcement and an update on the bank’s monetary policy.
ECB President Mario Draghi’s press conference has been closely followed for any hints on what is to be decided in the upcoming meeting, despite no changes being anticipated. Mr. Draghi is worried about the Chinese market meltdown of recent months, something that has put more deflationary pressure on the Eurozone after speculators piled into the euro in the wake of crisis.
As expected, Mr. Draghi confirmed that interest rates would remain unchanged. Continuing, he stated that the asset purchase scheme continues to proceed smoothly with a surprise decision to increase the share limit by 8% on its public sector programme, from 25% to 33%.
The ECB could look into expanding its quantitative easing programme, as Mr. Draghi points out that the asset purchase scheme is flexible and that the central bank could change the size, composition and duration of the programme to have more success.