The European Central Bank has decided to reduce its monthly asset purchases by half to 30 billion euros ($34.9 billion), as of the beginning of next year. The purchases are to last until at least September 2018, or longer if need be.
Interest rates are expected to rise only long after the end of the asset purchases. If the ECB followed the sequencing of the U.S. Federal Reserve, interest rates would not rise before September 2019. Against the background of recent economic indicators, the question arises: What does the ECB want to achieve with its policy?
