ECB Anticipated To Extend Elevated Pace of Bond-Buying

Economists and investors highly expect the European Central Bank to keep its emergency bond-buying current level despite a zooming economic recovery underway.

HSBC Holdings Plc, UBS Group AG, and ABN Amro Bank NV are among the financial institutions that expect the Governing Council to extend its current stimulus settings on June 10. Economists surveyed before the previous meeting said purchases would probably be scaled back next quarter.

An ultra-loose policy is seen amongst economists as more hawkish colleagues are not saying anything about the matter.

German 10-year yields have dropped 10 basis points since soaring to a two-year high last week, suggesting the prospects for a slowdown in the ECB’s program have been pared.

Purchases during this pandemic peaked in March when the U.S. economic recovery was fueling a global rise in borrowing costs while the euro zone was in a double-dip recession. Buying is now averaging close to 20 billion euros a week versus 14 billion euros a week at the start of the year.