Euro starts to fall after Nowotny’s statements

Baku. 5 October. REPORT.AZ/ The European Central Bank (ECB) is likely to slow its asset purchases gently at the start of next year, Report informs citing the Vestifinance, policymaker Ewald Nowotny said in remarks published on Thursday, weeks before the ECB meets to decide on the future of the quantitative easing program.

With the ECB’s current 2.3 trillion euro bond purchase program due to end in December, ECB policymakers are likely to use their meeting on October 26 to debate the merits of either extending the scheme for a relatively long period but with smaller monthly purchases, or retaining bigger monthly purchases, but for a shorter period.

“I assume that we will transition to a cautious deceleration at the start of the coming year,” ECB Governing Council member and Austrian central bank chief Nowotny told Austria's weekly magazine Trend. While confidence in the eurozone economy is growing, unemployment is slowly declining, and the economy is preparing to demonstrate the maximum growth over a decade, the European Central Bank is not able to achieve sustained inflation. This is crucial for the ECB, which seeks inflation "just below 2%."

After Nowotny’s announcement, the euro began to fall against its main rival, US-dollar. As a result, the rate fell from 1.1770 USD/EUR to 1.1730 USD/EUR.

Analytical Group of Report News Agency forecasts depreciation of the currency pair to 1.14 USD/EUR by the year end.