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ECB QE Monitor - April 2020

 

Key points for this month:

· ECB programs: €1,110bn of purchasing power in 2020, or around €110bn / month by the end of the year.

  • APP (Asset Purchase Programme): €20bn euros per month and a temporary envelope of €120bn euros spread over March-December (remaining: €70.4bn).
  • PEPP (Pandemic Emergency Purchase Programme): €750bn spread over April-December (remaining: €631.2bn).
  • Sovereign (PEPP and CSPP): net purchases will be around €90bn/month up to end of the year.
  • Corporate (PEPP and CSPP): net purchases will be around €10bn/month up to end of the year.

· The ECB continued its high pace of net asset purchases

  • In April, the ECB bought €157.3bn of assets: APP (€38.5bn) and PEPP (€118.8bn).

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· APP monthly net purchases by country: massive deviation from capital keys in favour of Italy, France and Spain against Germany and the Netherlands.

  • APP breakdown by country: Italy (€10.9bn), France (€8.3bn), Spain (€4.3bn) and Germany (€3.0bn).
  • Theoretical net purchases with capital key by country: Italy (€5bn), France (€6bn), Spain (€3.6bn) and Germany (€7.8bn).

· APP monthly net purchases by program:

  • PSPP (€29.6bn), CSPP (€5.6bn), CBPP3 (€3.6bn) and ABSPP (€-0.3bn).
  • Since restart of QE in November 2019, the proportion by programme is: PSPP (68%), CSPP (19%), CBPP3 (11%) and ABSPP (3%). Note that the PSPP proportion is significantly lower than the proportion of 80% that the ECB bought until December 2018.

· APP reinvestment :

  • PSPP Redemption in April 2020 increased to €30.3bn (after €13.2bn in March 2020).
  • PSPP redemptions will reach €195bn until April 2021 (€16.2bn per month).
  • CSPP redemptions will reach €16.8bn until April 2021 (€1.4bn per month).

· ECB will publish PEPP purchases by countries bi-monthly.

Amundi Research
April, 2020

BELLAÏCHE Mickael , Fixed Income Strategist
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ECB QE Monitor - April 2020
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