ECB Meeting Accounts: Governing Council ready to adjust all instruments including rates

The European Central Bank's (ECB) Governing Council was ready to adjust the full range of its instruments, including the TLTROs, policy interest rates and forward guidance, the accounts of the ECB's June meeting showed on Thursday.

Additional takeaways

"PEPP was a measure which was proportionate to counter the serious risks to price stability, the monetary policy transmission mechanism and the economic outlook in the euro area.

"It was argued that the proportionality assessment of any monetary policy measure had to consider, among other things, the degree to which the measure contributed to achieving the monetary policy objective."

"APP were proportionate measures under the current conditions for pursuing the price stability objective."

"Had to consider possible unintended side effects."

"It was highlighted that asset purchases were an essential tool."

"There was now ample evidence that asset purchase programmes in general and the PSPP in particular had proven effective."

"Negative side effects had so far been clearly outweighed by the positive effects of asset purchases."

"It could not be ruled out that unintended effects could increase over time and eventually outweigh the overall positive effects."

"There was ample evidence that the euro area economy would have fared much worse without the policy stimulus from APP."

"Risks of fiscal dominance could arise."

Market reaction

The EUR/USD pair continues to edge lower and was last seen losing 0.38% on the day at 1.1205.