European Central Bank (ECB) policymakers are seen to be going ahead with moves to halt the stimulus package with some parties urging for more action even if the conditions for raising rates have either been met or are about to be met.
Policymakers agreed in an earlier meeting that it chose to end bond buying until the third quarter and made no further commitments to re -announce the stimulus even as inflation continued to rise following the surge in oil and food prices.
However, policymakers are seen to be taking further action such as setting a date to end bond purchases and at the same time inflation has a tendency to jump higher.
The ECB said that the conditions for the adjustment to raise the ECB’s key interest rates have either been met or are about to be met. Waima so ECB noted that the war in Ukraine raises so much uncertainty that the ECB needs to ensure that the action taken is not so drastic.
High fuel prices and sanctions are seen to weigh on economic growth and the European zone’s economy is likely to stagnate for half of this year. The market is now setting the price in a combination of 60 basis points of a rate increase in the deposit rate of -0.5% this year. The ECB will meet on April 14.
