The interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will remain unchanged at 0.00%, 0.25% and -0.50% respectively, as a result of the ECB meeting dated October 27 - 28.

In addition, ECB Governing Council will continue to conduct net asset purchases under the PEPP with a total envelope of €1,850 billion until at least the end of March 2022 and, in any case, until it judges that the coronavirus crisis phase is over.

It was also reported that net purchases under the APP will continue at a monthly pace of €20 billion. Governing Council continues to expect monthly net asset purchases under the APP to run for as long as necessary to reinforce the accommodative impact of its policy rates, and to end shortly before it starts raising the key ECB interest rates. According to the decision, Governing Council stands ready to adjust all of its instruments, as appropriate, to ensure that inflation stabilises at its two per cent target over the medium term.

The Council will also continue to provide ample liquidity through its refinancing operations. In particular, the third series of targeted longer-term refinancing operations (TLTRO III) remains an attractive source of funding for banks, supporting bank lending to firms and households.

ECB President Christina Lagarde, who talked to the press after the meeting, said that the current period of high inflation will last longer than expected, but supply bottlenecks will be gradually resolved in 2022.

Noting that the labor market continues to recover, Lagarde stated that economic activity will have reached pre-pandemic levels by the end of the year, as well as that high energy prices may reduce purchasing power. She also added that the slowdown in PEPP purchases is not a tapering.