Central Banks
ECB Starts Talks on How to Shrink €5.1 Trillion Asset Hoard
- Officials ‘making it up as we go,’ Dutch official Knot says
- UK market turmoil showcases how such policy can get fraught
French policy maker Francois Villeroy de Galhau
Photographer: Zach Gibson/BloombergThis article is for subscribers only.
European Central Bank officials began discussions last week on how to shrink their €5.1 trillion ($4.9 trillion) portfolio as they look to widen the scope of their monetary tightening in due course.
“The Governing Council discussed the merits of its instruments, including interest-rate increases and downward balance sheet adjustments,” Luxembourg central-bank governor Gaston Reinesch said in a blog post Wednesday on what happened at a meeting on Oct. 5-6. “The pace and schedule of the balance sheet reduction, which will be data-dependent, will be determined in due course.”