But we should be wary of over-stretching this notion to mechanical prescriptive implications, because this can inspire unwise policy conclusions. A given level of the FCI can be delivered by many different combinations of drivers and underlying forces, which make the mapping between that particular level and the broad stance of policy an elusive task.
However, holdings of euro-denominated securities resulting from purchases made under the monetary policy asset purchase programmes also expanded significantly, with growth of € billion due, in particular, to the temporary pandemic emergency purchase programme, or PEPP.