Central Banks
What We Know as the ECB Gears Up to Reverse Years of Bond-Buying
- Officials to announce key quantitative-tightening principles
- President Lagarde promised ‘measured and predictable’ approach
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The European Central Bank is about to reveal its blueprint for shrinking almost €5 trillion ($5.3 trillion) of bonds — a delicate process that’s part of officials’ fight with unprecedented inflation but that also carries the danger of roiling markets.
Policymakers’ primary lever to rein in soaring prices remains interest rates, with a half-point hike expected at Thursday’s Governing Council meeting. But President Christine Lagarde and her colleagues have also promised the “key principles” for so-called quantitative tightening, which is expected to kick off early next year.