- ECB PEPP & APP: In February 2022, total net purchase pace was around €61bn vs €69bn in January 2022.
- PEPP
- Purchases amounted to €40bn in February, below those of January and consistent with a moderately weaker pace of purchases compared to Q4 2021. This brought total purchases under PEPP to €1,673bn on an envelope of €1,850 billion usable until the end of March 2022.
- The PEPP remained heavily oriented towards the public sector (around 97% of PEPP purchases).
- No granular details for PEPP were available at this release as the ECB will only publish details of PEPP composition (private/public or
jurisdiction) on a bimonthly basis and the next one will be in early April.
- APP
- Purchases settled €21bn in February 2022 vs. €19bn in January, slightly above the monthly target of € 20bn.
- In February APP by programme: PSPP (€12.1bn; 58.4% of total), CSPP (€6.3bn; 30.3%), CBPP3 (€2.38bn; 11.48%) and ABSPP (€-0.05bn; -0.2).
- Shares of public sector and corporate sector securities was above the level of recent months.
- The average maturity of PSPP remained stable at 7.3 years in February.
- Deviation of PSPP purchases from capital key proportions was in favour of Germany, Italy and Supras and against in France, likely due to redemption smoothening.
- APP redemptions in February 2022 amounted to €8.8bn, including €3.6bn in PSPP. Between March 2022 and February 2023, total APP redemptions will amount to €304bn including €238bn of PSPP redemptions.
Key points
Our convictions
- At its last meeting, the ECB was clearly on the hawkish side:
- ECB now focuses heavily on inflation and is determined to fulfill its price stability mandate.
- Downward revisions to growth forecasts remain modest.
- The ECB acknowledged the very high level of uncertainty and asserted that all options were on the table.
- The path of monetary policy will depend on data.
