ECB Bond Purchases Reach €1 Trillion

The European Central Bank’s (ECB) quantitative easing (QE) program topped 1 trillion euros ($1.124 trillion) this week after 18 months of aggressive bond buying, according to a MarketWatch article.

Late last year, SFIG reported that the ECB extended its QE program by six months, hoping to “add €680 billion – some 6.5 percent of the euro area GDP – in liquidity to the system by 2019…”

As MarketWatch explains, the ECB is using a so-called "capital key" to determine how many bonds from each country it should buy, with the amount proportional to a member state's gross domestic product. Expectations following the ECB policymakers’ upcoming meeting on September 8th are mixed: some expect the ECB to extend the run of the QE program beyond March 2017, while others believe it will wait to act until later in the year, in order to have a better understanding of the Brexit fallout.

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