ECB Is Said Likely to Take Small Steps in QE Exit Guidance
- Small shifts in policy language seen as way to avoid shocks
- Forward guidance sets tone for bond buying and interest rates
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The European Central Bank is likely to make multiple small adjustments to its guidance on monetary policy next year rather than any major change in language as it ends quantitative easing, according to euro-area officials familiar with the thinking of policy makers.
Incremental shifts in the wording used to describe the expected path of its policy would make sense and be consistent with a gradual exit from unconventional stimulus, said the people, who added that the issue hasn’t been formally discussed by the Governing Council. They asked not to be identified because the matter is confidential. An ECB spokesman declined to comment.