ECB needs to rethink market neutrality, Sustainable Policy Institute, April 2021
Wednesday 7 April 2021 – Vol.12 Ed.14.2
Commentary: ECB needs to rethink market neutrality
By Olaf Sleijpen in Amsterdam
The European Central Bank applies the concept of market neutrality in its purchase programmes. However, market neutrality in the form of a market capitalisation weighted benchmark – as used in the ECB’s corporate sector purchase programmes – may not be appropriate. Market failures that distort...