FRANKFURT (Reuters) – Solid growth provides room for the European Central Bank to transition away from bond purchases but normalization should be gradual and policy moves should be well telegraphed, Lithuanian policymaker Vitas Vasiliauskas said in a magazine article.
“The (bond) purchases will be ended gradually rather than abruptly, ensuring a smooth transition of sufficient length,” Vasiliauskas said in the Eurofi magazine.
“Any further policy steps will be well-discussed, data-based and gradual, providing sufficient time for markets to adjust,” he said. “We should be ready for an increase in market volatility, which has been exhibiting unnaturally low levels.”
Vasiliauskas said that the ECB Governing Council has already built an agenda for its next several steps, spanning an extended period of time.
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