The European Central Bank (ECB) said on Wednesday it would temporarily pause its massive bond-buying program between December 22 and January 1, resuming the purchases on January 4.
The move is “in anticipation of lower market liquidity during this period and in order to reduce possible market distortions”.
The bank, which controls monetary policy across the 19 countries that use the euro, said purchases between November 27 and December 21 would be somewhat frontloaded.This is “to take advantage of the relatively better market conditions expected during the early part of the month.”
ECB President Mario Draghi has hinted that that the bank could look to ramp up or extend its 1 trillion euro ($1.1 trillion) quantitative easing (QE) program.
At the moment, the ECB purchases 60 billion euros worth of assets each month and has committed to doing so until at least September 2016.
Its next monetary policy meeting and subsequent media conference with Draghi will take place on December 3 in Frankfurt. An announcement on expanded asset purchases is hotly anticipated and may roil markets, particularly given that the U.S. Federal Reserve is seen making a historic interest rate rise in the same month.
