ECB reveals asset buying plan

ECB president Mario Draghi
ECB president Mario Draghi

The European Central Bank has ramped up its stimulus for the moribund 19-nation single currency bloc by announcing that it will buy 60 billion (£46bn) of assets every month.

ECB president Mario Draghi told a press conference in Frankfurt that the purchases were an expansion of an existing policy.

He also said the central bank would start a widely-anticipated programme of buying government bonds, along the lines of the quantitative easing (QE) that has already been pursued in the US and UK. This process is due to begin in March.

Mr Draghi said the wider asset purchase programme was intended to carry on until September 2016 - and “in any case be conducted until we see a sustained adjustment in the path of inflation”.

It comes as the eurozone is facing stagnation with inflation at minus 0.2 per cent, threatening a damaging deflationary spiral.

The scale of the asset purchase scheme over 19 months would amount to 1.14 trillion euros (£870bn).

Mr Draghi said purchases will start to include the purchase of bonds “issued by euro area governments and agencies and European institutions” from March.