MNI BRIEF: PEPP, APP Remain Crucial In Time To Come - Schnabel

Uncertainty over the course of the Covid-19 pandemic and the euro area's economic and inflation outlook mean the European Central Bank's PEPP and APP "will remain crucial in the time come," ECB Executive Board Member Isabel Schnabel argued in a speech Monday, "paving the way out of the pandemic and towards reaching our inflation target."

The role of central bank asset purchases has changed as the Covid-19 pandemic transitions from crisis to recovery phase, serving first to calm stressed financial markets, Schnabel said, then to bolster confidence and shore up the economy and the inflation outlook, and finally through the signalling channel as a "powerful commitment device, reinforcing forward guidance and reducing uncertainty around the future course of monetary policy.