Gibran WATFE, 4 December 2015
Yesterday, the ECB announced an extension of its quantitative easing (QE) programme that was started in March this year. Apart from extending QE for at least six months to March 2017, Mr. Draghi, the President of the ECB, announced a widened scope of the programme. Only certain types of assets are allowed to be bought as part of the QE programme. This included, so far, sovereign and supranational bonds, as well as asset-backed securities and covered bonds. Yesterday, the list of eligible assets was extended to regional and local government bonds. Why did the ECB do this?