The European Central Bank said Thursday that it will step up its emergency bond purchases over the next quarter based on market conditions and left its key interest rates unchanged. The Governing Council, led by ECB President Christine Lagarde, left the size of the pandemic emergency purchase program, or PEPP, unchanged at EUR 1,850 billion and said these will continue until at least the end of March 2022 or when the coronavirus crisis phase is over. "Based on a joint assessment of financing conditions and the inflation outlook, the Governing Council expects purchases under the PEPP over the next quarter to be conducted at a significantly higher pace than during the first months of this year," the bank said. "The Governing Council will purchase flexibly according to market conditions and with a view to preventing a tightening of financing conditions that is inconsistent with countering the downward impact of the pandemic on the projected path of inflation," the ECB added. ING economist Carsten Brzeski said market participants had started to speculate whether and how the ECB would react to the recent increase in bond yields and heating up of inflation fears.
The latest policy statement suggests that the ECB is trying to demonstrate its willingness to put a cap on bond yields without showing signs of panic, the economist added.
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May 15, 2026 15:25 ET Apart from the confirmation of Kevin Warsh as the next Fed chair, the main news on the economics front this week included key price data from the U.S. and the first quarter economic growth figures from major economies. Both consumer prices and producer costs have started to reflect the effect of supply shocks due to the Middle East conflict. In Europe, GDP data was in focus, while inflation data from China dominated the news flow in Asia.