ECB’s Lane Says Will Continue Investor Calls Despite Controversy
(Bloomberg) -- European Central Bank Chief Economist Philip Lane said he will continue calling banks and investors after policy decisions, defending his approach despite controversy about the institution’s communications strategy.
“It’s very important whenever policy officials such as myself interact with market participants that it’s done in a very systemic, structured, planned, transparent way,” he said in a interview with Reuters. “It’s important, our standing approach right now is to continue those calls.”
His response comes a day after a report, based on Executive Board members’ diaries, said that Lane held 11 separate calls in the hours following a market-moving misstep by President Christine Lagarde in a March 12 press conference.
Lane said that his calls with investors and banks conformed with the ECB’s principles of how to interact with the market. They are part of a deliberate and structured approach and a good communication policy, he added.
“It’s not to front-run future decisions,” Lane said. “So, the timing, I think we thought a lot about it.”
An ECB spokesman said earlier that the decision to start regular briefings was taken in September 2019 and implemented in March 2020, to hear the views of economists and address any technical questions. They only touch on public information and their only focus is on the policy decision published beforehand, he said.
The issue arises just days before the ECB is poised to boost its response to the pandemic. Economists predict the ECB will expand its 1.35 trillion-euro ($1.6 trillion) pandemic bond-buying program by about 500 billion euros, extend it by at least six months to the end of next year, and offer more long-term loans to banks.
Lane said it was too early to discuss the shape of the new package, but it was clear the ECB needs to support financing conditions.
©2020 Bloomberg L.P.