Greece, bond purchases to top agenda at ECB meeting

The European Central Bank, bolstered by the success of its controversial bond purchase programme, will pledge to keep it in place while downside risks to economic growth remain, analysts said.

The ECB's decision-making governing council is scheduled to meet on Wednesday but is unlikely to announce any new policy moves, central bank watchers predicted.

Instead, analysts said they would be listening out for what president Mario Draghi has to say about the effectiveness of the programme so far and about the situation in Greece.

"At its June press conference, the ECB is unlikely to announce any major new policy measures and will argue that its past actions are already yielding results,» said Ben May of Oxford Economics.

In March, the ECB embarked on a programme of so-called quantitative easing or QE, buying up 1.14 trillion euros in assets -- at a monthly rate of 60 billion euros per month -- until September 2016.

The aim is to inject liquidity into the financial system and push up the eurozone's chronically low rate of inflation.

Ramping up purchases

Executive board member Benoit Coeure caused a stir two weeks ago when he announced that the ECB could «frontload» -- or temporarily ramp up -- the purchases prior to the summer drop-off in liquidity.

"This has been interpreted by many in the markets as a statement of intent from the ECB to prevent yields from rising to levels that could threaten the still reasonably fragile economic recovery,» May said.

Draghi, probably satisfied by the impact of Coeure's comments, could state that the change in plan was «merely a tweak for technical reasons,» the expert said.

But he was unlikely to rule out more frontloading if the ECB perceived it to be justified by the...