A breakdown of the purchases shows central bankers bought €11.1bn-worth of German government bonds, and €8.75bn and €7.6bn in French and Italian bonds respectively.
Central bankers bought government bonds from all member states except Greece and Cyprus, which are banned from QE until the member states comply with the terms of their EU bailout programmes, and Estonia.
Officials across the currency area started buying their government’s debt on March 9 after policy makers unleashed a controversial €1.1tn QE programme on January 22 to tackle the threat of economic stagnation.
Policy makers on the ECB’s governing council said at the time they would buy €60bn-worth of private and public sector assets between March and September 2016. The better news on the eurozone economy has sparked speculation that the ECB will begin to taper its bond-buying before the autumn of next year.
Yves Mersch, a member of the ECB’s executive board, on Tuesday signalled policy makers would consider paring their bond buying should inflation show signs of hitting the ECB’s target of below but close to 2 per cent earlier than expected.
Prices fell by 0.1 per cent in the year to March, but the ECB expects inflation to hit 1.8 per cent by 2017. Mr Mersch told Börsen Zeitung, a German newspaper: “If we were to see that this process brings us to our goal earlier, then we are naturally not so tied to our decisions that we could not adjust things.”
Some market players have voiced concerns the ECB would struggle to buy bonds in the amounts needed because of a lack of issuance of debt by major eurozone governments.
“With the first month of its expanded asset purchase programme complete, the ECB can look back at a success,” said Christian Schulz of Berenberg Economics. “The operational implementation has been smooth and the policy effectiveness probably exceeded the ECB’s own expectations.”
However, eurozone central bankers have privately acknowledged that it may become tougher for the ECB to buy in the volumes needed during the second half of the programme, set to end in the autumn of 2016.
Since QE was announced the outlook for the eurozone’s recovery has improved, partly because of the impact of the policy in weakening the euro against the dollar. The slump in the price of oil, as well as the cheaper euro, has helped boost expectations that 2015 will be the year when the eurozone’s lacklustre recovery strengthens.
© Financial Times
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