{"id":128416,"date":"2021-06-10T17:02:15","date_gmt":"2021-06-10T17:02:15","guid":{"rendered":"https:\/\/precoinnews.com\/?p=128416"},"modified":"2021-06-10T17:02:15","modified_gmt":"2021-06-10T17:02:15","slug":"despite-economic-recovery-the-european-central-bank-keeps-its-policies-steady","status":"publish","type":"post","link":"https:\/\/precoinnews.com\/business\/despite-economic-recovery-the-european-central-bank-keeps-its-policies-steady\/","title":{"rendered":"Despite economic recovery, the European Central Bank keeps its policies steady."},"content":{"rendered":"

<\/p>\n

By <\/span>Eshe Nelson<\/span><\/p>\n

Even as Europe\u2019s economic outlook is rapidly improving, European Central Bank policymakers decided on Thursday to maintain their \u201cvery accommodative\u201d monetary stance.<\/p>\n

Governments are lifting lockdown restrictions and the vaccine rollout has sped up, which has led to a bounce in the services industry and \u201congoing dynamism\u201d in manufacturing, Christine Lagarde, president of the central bank, told reporters at a news conference in Frankfurt.<\/p>\n

\u201cWe expect economic activity to accelerate in the second half of this year as further containment measures are lifted,\u201d she said.<\/p>\n

But Ms. Lagarde stressed thatlots of support was still needed and that policymakers were giving the economy a \u201csteady hand.\u201d<\/p>\n

\u201cUncertainties remain, as the near-term economic outlook continues to depend on the course of the pandemic,\u201d she added.<\/p>\n

The bank said it would hold interest rates at record low and negative levels while continuing to buy bonds in its pandemic response program at \u201ca significantly higher pace\u201d for the next quarter compared with the start of the year \u2014 currently, a rate of about 80 billion euros a month.<\/p>\n

\u201cThe ECB is currently choosing to err on the side of caution rather than withdraw monetary stimulus prematurely,\u201d analysts at ING wrote in a note.<\/p>\n

Staff members at the central bank also published new forecasts for economic growth and inflation in the region. The eurozone economy will grow 4.6 percent this year and 4.7 percent next year, they said, compared with forecasts from three months ago that predicted 4 percent and 4.1 percent growth.<\/p>\n

In the United States, policymakers are watching rising inflation, which rose 5 percent in May, the fastest annual rate since 2008. Economists say a sustained increase in inflation would force the Federal Reserve to pull back its monetary stimulus. But Ms. Lagarde said the American and European recoveries were \u201ca very, very different story.\u201d<\/p>\n

In the euro area, inflation is expected to rise over the next few years, including core inflation, which excludes volatile energy and food prices, but the increase is \u201clargely\u201d a result of temporary factors, the bank said. The central bank does not forecast price gains to rise above its 2 percent target.<\/p>\n

Staff projections, which were revised higher since March, point to a 1.9 percent annual inflation rate in 2021 and 1.5 percent rate next year.<\/p>\n

In March, the central bank increased the pace of the assets purchases in its Pandemic Emergency Purchase Program, which is scheduled to buy 1.85 trillion euros worth of debt by the end of March. <\/span>Bond-buying programs are intended to keep interest rates low and smooth access to credit for businesses and households.<\/p>\n

Data published earlier this week showed that the eurozone\u2019s economy did not fare as badly in the first quarter as initially expected. Gross domestic product declined 0.3 percent in the first three months of the year, the statistics agency said, not the 0.6 percent decline that was previously estimated.<\/p>\n

Ms. Lagarde also said it was too soon for policymakers to even begin discussing when and how it might end its pandemic bond-buying program. \u201cIt\u2019s too early, it\u2019s premature, it\u2019s unnecessary,\u201d she said.<\/p>\n

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By Eshe Nelson Even as Europe\u2019s economic<\/p>\n","protected":false},"author":3,"featured_media":128415,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[23051],"tags":[],"yoast_head":"\nDespite economic recovery, the European Central Bank keeps its policies steady. - Pre Coin News<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/precoinnews.com\/business\/despite-economic-recovery-the-european-central-bank-keeps-its-policies-steady\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Despite economic recovery, the European Central Bank keeps its policies steady. - Pre Coin News\" \/>\n<meta property=\"og:description\" content=\"By Eshe Nelson Even as Europe\u2019s economic\" \/>\n<meta property=\"og:url\" content=\"https:\/\/precoinnews.com\/business\/despite-economic-recovery-the-european-central-bank-keeps-its-policies-steady\/\" \/>\n<meta property=\"og:site_name\" content=\"Pre Coin News\" \/>\n<meta property=\"article:published_time\" content=\"2021-06-10T17:02:15+00:00\" \/>\n<meta name=\"author\" content=\"mediabest\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:image\" content=\"https:\/\/precoinnews.com\/wp-content\/uploads\/2021\/06\/Despite-economic-recovery-the-European-Central-Bank-keeps-its-policies-steady..jpg\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"mediabest\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/precoinnews.com\/business\/despite-economic-recovery-the-european-central-bank-keeps-its-policies-steady\/\",\"url\":\"https:\/\/precoinnews.com\/business\/despite-economic-recovery-the-european-central-bank-keeps-its-policies-steady\/\",\"name\":\"Despite economic recovery, the European Central Bank keeps its policies steady. - 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