The European Central Bank's emergency stimulus could end next year

The European Central Bank (ECB) could end its emergency stimulus program for March next year. The head of the Austrian central bank, Robert Holzmann, said this on Monday, but he does not expect the bank to subsequently increase the purchase of traditional bonds. Economists, including ECB analysts, estimate that the easing of a € 1.85 trillion emergency bond purchase program in the eurozone will end next March in March as a result of the easing of the new coronavirus pandemic. At the same time, they do not expect the bank to increase purchases under another Asset Purchase Program (APP) to compensate for the lost incentives. "This is how the market sees it and I think it is right," said Holzmann, a member of the ECB's Governing Council. He added that the exact end of the emergency program is not yet known, but at the moment it looks like it will end in March. Extraordinary incentives must end when the pandemic ends. However, the ECB will continue to support the economy through other schemes, Holzmann noted, who even mentioned the possibility of adjusting the APP asset purchase program. "We still have other programs, such as APP, that can continue, changed or unchanged," said Holzmann, one of the more conservative members of the ECB during a roundtable discussion organized by UBS. He added that the pandemic is far from over, so this timetable could change and the ECB will review the situation in more detail before publishing its new projections in September.