Summary

  • The Governing Council decided to take further steps in normalizing monetary policy. Throughout this process, it will maintain optionality, data-dependence, gradualism and flexibility. (Change)
  • Judged that the incoming data since its last meeting reinforced its expectation that net asset purchases under its asset purchase programme should be concluded in the third quarter. (No Change)
  • The Governing Council decided to end net asset purchases under its asset purchase programme (APP) as of 1 July 2022. (Change)
  • The Governing Council intends to continue reinvesting, in full, the principal payments from maturing securities purchased under the APP for an extended period of time past the date when it starts raising the key ECB interest rates and, in any case, for as long as necessary to maintain ample liquidity conditions and an appropriate monetary policy stance. (No Change)
  • The Governing Council intends to reinvest the principal payments from maturing securities purchased under the programme until at least the end of 2024. In any case, the future roll-off of the PEPP portfolio will be managed to avoid interference with the appropriate monetary policy stance. (No Change)
  • The Governing Council intends to raise the key ECB interest rates by 25 basis points at its July monetary policy meeting. In the meantime, the Governing Council decided to leave the interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility unchanged at 0.00%, 0.25% and   -0.50%, respectively. (Change)
  • Looking further ahead, the Governing Council expects to raise the key ECB interest rates again in September. The calibration of this rate increase will depend on the updated medium-term inflation outlook. If the medium-term inflation outlook persists or deteriorates, a larger increment will be appropriate at the September meeting. Beyond September, based on its current assessment, the Governing Council anticipates that a gradual but sustained path of further increases in interest rates will be appropriate. In line with the Governing Council’s commitment to its 2% medium-term target, the pace at which the Governing Council adjusts its monetary policy will depend on the incoming data and how it assesses inflation to develop in the medium term. (New)
  • Any adjustments to the key ECB interest rates will take place sometime after the end of the Governing Council’s net purchases under the APP and will be gradual. The path for the key ECB interest rates will continue to be determined by the Governing Council’s forward guidance and by its strategic commitment to stabilize inflation at 2% over the medium term. (No Change)
  • The special conditions applicable under TLTRO III will end on 23 June 2022. (Change)

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