In a blog post, Chief Economist Lane calls......>

ECB: In a blog post, Chief Economist Lane calls the ECB's expansion of PEPP by

EUR600bln "the proportionate response to the substantial downward revision of

the economic and inflation outlooks and the significant deterioration in

financial conditions". 

- Says that "while conditions in financial markets have stabilised substantially

since the PEPP announcement, the situation remains fragile. This fragility

underlines the continued need for the central bank to be flexible and exercise a

market stabilisation function to the extent necessary."

- Going forward, "the incoming economic and financial data and future projection

rounds will provide essential guidance as to whether the pandemic-related

negative shock to inflation dynamics has been sufficiently contained."