The European Central Bank (ECB) outlined plans to end its massive stimulus program by the end of this year.
Market players had described this month’s meeting as being “live,” following remarks by the central bank’s chief economist that the ECB would start preparing to end its stimulus. ECB’s Peter Praet said last week the bank would be discussing how to unwind its asset purchase program — which was implemented in 2015 to revamp the euro economy in the wake of the 2011 sovereign debt crisis.
Germany’s ECB representative, Jens Weidmann, also said last week that he expects the trillion-euro program to come to an end before the end of this year.
David Zahn, the head of European fixed income at investment firm Franklin Templeton, told CNBC’s “Squawk Box Europe” Friday that the ECB had “spent 2.5 trillion (euros) to do QE, and they want to make sure they don’t exit too quickly and kinda end up wasting over 2 trillion euros.”
The ECB has been under renewed scrutiny over the last few weeks. Some analysts and officials have suggested that stronger economic data in the region requires a tighter attitude towards monetary policy. The new anti-establishment government in Italy has also voiced some criticisms of the central bank.
Members from the new government accused the ECB of market manipulation by buying more German bonds in May and less Italian debt. Experts told CNBC that there were technical reasons that justified such purchases last month.