The European Central Bank (ECB) has kept its monetary policy unchanged. However, it did slow down the pace of net asset purchases under its pandemic emergency purchase program. The ECB’s main refinancing operations remain at 0%, on the marginal lending facility at 0.25%, and on the deposit facility at -0.5%. The ECB said that it believes that “favourable [sic] financing conditions can be maintained with a moderately lower pace of net asset purchases under the (PEPP) than in the previous two quarters.”
The junkies think what the central banks have to say is still relevant and are eagerly waiting for word to come down from above to see if their unwinding of pandemic-era stimulus in the face of surging inflation would take place. That seems like reading a nice bedtime story to the kids so they sleep with pleasant dreams. The ECB reiterated that interest rates will remain at their present or lower levels until inflation is seen reaching 2% “well ahead of the end of its projection horizon and durably for the rest of the projection horizon,” and until the ECB determines that inflation will stabilize at 2% over the medium-term.
It is really extraordinary to think that there will ever be a return to normal. The ECB has had negative interest rates since 2014. The Federal Reserve warned the ECB that they could get trapped. The warnings were coming in, and even in 2016, the London Evening Standard warned of the black hole of negative interest rates. This entire Great Reset is now due to the fiscal mismanagement of governments and central banks. Those who still think there will be some return to normal finance are no doubt those wearing masks and lining up for booster shots every six months. They can’t wait for the new Pfizer daily pills as well and are ready to listen to Bill Gates and never buy beef again.
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