Euro gains after ECB announces asset purchase program

Forex
© Reuters.  Euro gains after ECB announces asset purchase program © Reuters. Euro gains after ECB announces asset purchase program

By Stanley White

TOKYO (Reuters) – The euro rose on Thursday against the dollar and the pound after the European Central Bank announced a 750 billion euro asset-purchase program in response to the coronavirus outbreak.

The ECB said the new program, which targets public- and private-sector assets, will be conducted until the end of 2020.

The ECB’s announcement is the latest in a series of steps by major central banks this week to offset the impact the coronavirus outbreak is having on the global economy and financial markets.

The euro () rose 0.26% to $ 1.0947 early in Asia on Thursday. Against the pound, the euro rose 0.6% to 94.30 pence.

Against the yen, the common currency gained 0.47% t 118.55.

The ECB’s purchase scheme, which was announced at an emergency meeting late on Wednesday, came less than a week after policymakers launched fresh stimulus measures.

The new asset-purchase program will also include debt from Greece, which has so far been shut out of ECB bond purchases due to its low credit rating, the ECB said.

Global markets have experienced months of turmoil as the coronavirus, which emerged in central China late last year, has now spread to more than 100 countries and claimed more than 8,000 lives.

The heightened uncertainty around previously unknown virus, which has triggered emergency lockdowns and injections of cash unseen since World War Two, is causing investors to abandon traditional trading strategies in favor of selling what they can to keep their money in dollars.

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