ECB to Phase Out Stimulus Sooner Than Expected

    Photo: Getty Images [via Business Insider]

    The Facts

    • The European Central Bank said Thurs that it plans to end its pandemic-era bond-buying stimulus program at the end of March, and older efforts in the third quarter if inflation doesn't weaken.

    • Euro area annual inflation jumped to 5.8%, a record high, in Feb. and is expected to keep rising due to the war in Ukraine.


    The Spin

    Establishment-critical narrative

    The ECB should hold off until we better understand the economic impact of the Ukraine-Russia crisis. Its actions are completely backward; the Bank should've been eyeing interest rate moves before tapering its asset purchasing program, which will be very difficult to reinstate again if needed.

    Pro-establishment narrative

    The Russia-Ukraine war is a watershed moment for Europe, but interest rates have held steady. The decision to stop pumping money into financial markets will prevent stagflation. The ECB is working to keep its commitment to price stability and normalize monetary policy.


    Establishment split

    CRITICAL

    PRO

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