ECB opened door to removing bond-buying pledge at June meeting: minutes

[July 06, 2017]  FRANKFURT (Reuters) - European Central Bank rate setters meeting last month opened the door to dropping from their policy message a long-standing pledge to expand or extend the bank's bond-purchase program if necessary, minutes of the meeting showed on Thursday.

Flags in front of the European Central Bank (ECB) before a news conference at the ECB headquarters in Frankfurt, Germany, April 27, 2017. REUTERS/Kai Pfaffenbach

The policymakers discussed already taking out that so called "easing bias" at the June 7-8 meeting but decided against it because an economic recovery in the euro zone had yet to result in higher inflation.

But, confirming a Reuters exclusive, the central bankers said the case for keeping that pledge could be reviewed in future meetings.

"If confidence in the inflation outlook improved further, the case of retaining this bias could be reviewed," the ECB said in the accounts of the meeting.

At the same time, the central bank stressed the need for "continued caution in communication" as a perception that it was moving away from its ultra-easy policy of low rates and massive bond purchases could upset financial markets.

(Reporting By Francesco Canepa; Editing by Balazs Koranyi)

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