ECB ends $3 trillion quantitative easing program

The European Central Bank completed a quantitative easing program that was aimed at boosting the economy and dispersing inflation in the eurozone, and cost the regulator €2.6 trillion, or $3 trillion. The curtailment of the program, under which the ECB has been buying eurozone bonds since 2015, was announced in June, but now the European economy is not in the best shape to end the experiment, notes . Bloomberg

The quantitative easing program was launched in March 2015 in the hope that it would save the eurozone economy from deflation - by lowering interest rates, the regulator hoped to force investors to take risks. It was assumed that the program would last no more than two years, but it was repeatedly extended. Due to the purchase of assets and the issuance of long-term loans, the ECB's balance sheet swelled to € 4.7 trillion, which is equivalent to 40% of the eurozone's GDP compared to 20% in the case of a similar program, which was carried out by the US Federal Reserve until the fall of 2014, writes Bloomberg. Until September, the ECB bought €30 billion worth of bonds every month, then the amount of injections was reduced to €15 billion per month. You can read more about how the decision to launch the program was made here .

Economic support. Concluding the program, the ECB promised to continue to support the eurozone economy: the purchase of assets will be completed in December 2018, but key rates will remain at current levels until at least next summer, and all income from purchased securities will be reinvested for a long time even after the regulator starts raise key stakes.

Rates. The ECB kept interest rates at record low levels: the base refinancing rate at zero, the deposit rate at minus 0.4%, and margin loans at 0.25%.

Whether the program worked is debatable, writes Bloomberg. According to the latest ECB forecasts, the purchase of assets in total will add 1.9 percentage points. economic growth and inflation in the period from 2016 to 2020. Eurozone GDP growth in 2016-2017 also outpaced that of the United States. At the same time, in the third quarter of this year, economic growth slowed to 0.2%, the lowest rate since 2014. The growth forecast for this year has already been reduced to 2.1% (-0.3% compared to 2017).

Egor Sonin