[Slide 12: III – Impact EAPP] [Slide 13: Transmission of central banks’ asset purchase programmes] The Eurosystem buys securities with newly issued central bank money. The Eurosystem’s balance sheet expands, and liquidity of the banking system increases. The impact of asset purchases transmits to output and inflation via the financial markets: yield curves, lending rates, asset prices and exchange rates.
Financial market prices react rapidly, but output and prices only gradually over time. [Slide 14: Implementation of EAPP has been smooth. “It is a marathon”] This slide presents all outright asset purchase programmes of the Eurosystem, including those that are no longer active. The current expanded asset purchase programme started off smoothly and purchases followed the agreed plan.