15 days ago • Posted by Charles-Henry Monchau

ECB balance sheet hits fresh All-Time-High at €7.522tn ahead of this week's meeting

Tomorrow's ECB meeting is likely to be an unexciting one. Expectations are for the ECB to leave interest rates unchanged and maintain the current duration of the bond buying program (PEEP). However, Lagarde will need to navigate between a stronger Euro and stronger yields and a current poor environment regarding the covid and economic data. As many countries are set to end lockdowns within a few weeks, she must temper any hopes that the ECB may begin tapering anytime soon in order to keep yields and the euro as low as possible. In terms of asset purchase, Lagarde "walks the talk". Indeed, she keeps printing press rumbling. Total assets rose by €7.9bn on QE which means that ECB balance sheet now equals to 70.3% of Eurozone GDP (vs. Fed's 36.3%, and BoJ's 130%). 

Source: Bloomberg, Holger Z. 

ECB balance sheet