ECB Official Warns About Incentive Packages

ECB Official Warns About Incentive Packages ECB official warns about the incentive packages. Isabel Schnabel signaled that there won’t be a massive stimulus package. European Central Bank (ECB) Board Member Isabel Schnabel stated that the bank should focus on maintaining current financial conditions rather than announcing a massive stimulus package that exceeds market expectations. Speaking about a week before the ECB Executive Council's interest rate decision, Schnabel predicted that the support for the coronavirus outbreak would be longer than expected, said, "This should reflect our policy decisions." Stating that borrowing costs fell to record low levels due to monetary and financial support, Schnabel said that it is important that these incentives and supports continue until the crisis is over.   Schnabel used the following statements: “We need to focus on maintaining current conditions rather than more relaxation. If we need to do something that doesn't meet market expectations, we need to do it.” In addition, economists expect the ECB to increase its 1.35 trillion euro pandemic asset purchase program by nearly 500 billion euros and extend its duration by at least 6 months to the end of 2021.       In this article, Bloomberg HT contributes.