ECB sees Scope for Rebound as Vaccines are Rolled Out

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The European Central Bank left policy unchanged as expected on Thursday, keeping copious stimulus flowing even as it predicted a firm rebound in the euro zone economy in the coming months as pandemic restrictions are lifted.

The ECB is keeping borrowing costs pinned near record lows via massive bond purchases to see the 19country currency bloc through a scarring recession that has kept schools, shops, restaurants and hotels closed for most of the last year.

But growth is expected to rebound quickly from midyear as COVID19 infections are brought under control, the pace of vaccination picks up and restrictions are removed, raising questions about just how much ECB help is still needed.

There are clearly signs of improvement, President Christine Lagarde told a news conference.

Progress with vaccination campaigns and an envisaged gradual relaxation of containment measures underpin expectations of a firm rebound in economic activity in the course of 2021.

She stressed the overall situation was still clouded with uncertainty, however, due to factors ranging from the possible spread of new virus variants to risks to financing conditions and continued pressures on struggling sectors of the economy.

Survey data later on Thursday showed consumer confidence continuing to improve and now just below levels seen before the pandemic started in early 2020.

Germanys 10year government bond yield, the benchmark for the euro area, rose 0.5 basis points to 0.25 after the ECBs policy…

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