ECB’s Schnabel: ECB to weigh more bond buying if war crashes economy

“The European Central Bank would consider extending its money-printing programme beyond this summer if the eurozone economy fell into a 'deep recession' because of the conflict in Ukraine,” said ECB board member Isabel Schnabel said on Thursday, per Reuters.

Additional quotes

The central bank had "left the door ajar" in case events took a turn for the worse for the eurozone, which is highly dependent on Russian gas and other raw materials.

If we now fall into a deep recession due to the Ukraine crisis, we'll have to rethink that.

Otherwise, we'll end the bond purchases in the third quarter and as soon as we've done that we can raise rates at any time depending on how inflation develops.

Estonian central bank governor Madis Mueller, another hawk on the ECB's policy-making Governing Council, said in a Politico interview the ECB would only extend its Asset Purchase Programme if there was 'a dramatic shift' in the inflation outlook.

Market reaction

EUR/USD failed to cheer the news amid mixed concerns over Ukraine-Russia and the market’s anxiety over inflation. That said, the quote was last seen taking rounds to 1.1000 after a volatile day, with mild losses.

Read: EUR/USD braces to 1.1000 amid a firm US dollar