dpa/GNA – The European Central Bank is expected to leave its emergency stimulus plan on hold Thursday as it takes stock of the eurozone’s economic prospects amid the rollout of the coronavirus vaccine and new anti-pandemic lockdown measures.
In particular, the ECB is expected to review the success of its 1.85 trillion euro (2.25 trillion dollar) bond-buying plan in helping to curb the economic fallout from the coronavirus crisis.
Meeting for the first time this year, the ECB’s 25-member rate-setting council is also widely forecast by analysts to leave the bank’s benchmark refinancing rate on hold at a historic low of zero and the deposit rate at minus 0.5 per cent.
The deposit rate sets the rate that financial institutions park funds at the ECB.
Thursday’s meeting coincides with the initial, often faltering moves by European governments to roll out the coronavirus vaccine, which ECB President Christine Lagarde sees as key to rebuilding economic confidence following the spread of the virus over the last year.
Indeed, looming large over the eurozone are concerns that last year’s dramatic economic slump could now stretch into this year.
Meanwhile, governments across the 19-member eurozone – notably Germany – have been moving towards a further round of harsh lockdown measures.
This could threaten the ECB’s growth forecasts or even risk the eurozone stumbling into a double-dip recession in the first quarter of this year, analysts say.
Also worrying for the ECB has been the eurozone’s sub-zero inflation rates following the weak economic activity but now exacerbated by a strong euro.