That was almost too painful to watch, ECB President’s Lagarde press conference. In her attempt to walk back on the hawkishness of the Governing Council statement she failed to give a clear message on what the ECB hopes to achieve with pandemic bond buying. Is pandemic QE a program of (temporary) monetary base expansion intended to boost nominal GDP, requiring the purchases of a fixed amount of bonds? Or is the target some level of interest rates in the market and interest rates on bank loans? Cleary, the ECB hasn’t taken heed of the Tinbergen rule: one policy instrument for one objective.


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