During today’s conference, Christine Lagarde said that the last outlook from December is still convincing and considers restrictive measures until the end of the first quarter. ECB does not plan to change the outlook for the worsening of the pandemic, it still expects gross domestic product (GDP) growth of 3.9 per cent in the euro area this year. Bank of America expects growth of 2.9 per cent, which is a whole percentage point less than expected in the previous forecast.
On the other side, she pointed out that: "However, there would be cause for concern if Member States still needed closures after the end of March and if, for example, vaccination programs were slowed down." The problem will occur if the current closures do not end in the first quarter.
ECB fight against deflation and economic slowdown with quantitative easing and bond purchase programs which extended until 2022. The ECB now has a total of 1.85 trillion euros to buy bonds. Lagarde said that if it proved necessary, the ECB was ready to expand the bond-buying program again.
Performance of EUR/USD (Tradingview.com)