European Central Bank

The Delors Committee, established in 1988, proposed the roadmap for the Economic and Monetary Union (EMU) in Europe, leading to the eventual creation of the Euro currency.

On 1 January 1991, the European Central Bank (ECB) exercised its full powers after the introduction of the Euro as the official currency for the Euro area. This marked a significant moment as the national central banks of the 11 EU member states transferred their monetary policy function to the ECB.

The Maastricht Treaty, signed in 1992, laid the foundation for the establishment of the European Central Bank and the Economic and Monetary Union (EMU).

The European Monetary Institute was established in 1994 as a precursor to the European Central Bank, laying the groundwork for the single currency and monetary policy coordination.

The EMI was established at the start of the second stage of the EU's Economic and Monetary Union (EMU) to handle transitional issues of states adopting the euro and prepare for the creation of the ECB and ESCB.

The Euro currency was introduced on January 1, 1999, as the official currency for the Eurozone countries, marking a significant milestone in European economic integration.

German economist German Issing proposed that the ECB should be more transparent and have democratic responsibility to improve efficiency and credibility. Other suggestions include closer relationship with the European Parliament and the development of new institutions.

The initial changeover to the euro took place in 2002, marking a significant shift in the monetary landscape of participating countries.

In May 2003, following a review of the ECB's monetary policy strategy, the Governing Council clarified that in pursuing price stability, it aimed to maintain inflation rates below, but close to, 2% over the medium term.

Jean-Claude Trichet replaced Wim Duisenberg as president of the ECB in November 2003.

Slovenia joined the euro area in 2007, transitioning to the euro as its official currency.

Cyprus joined the euro area in 2008, adopting the euro as its official currency.

On 1 December 2009, the Treaty of Lisbon became effective and the European Central Bank gained the official status of an EU institution.

On December 23, 2009, the European Central Bank (ECB) initiated a public consultation on a certain matter.

The consultation period that started on December 23, 2009, concluded on February 26, 2010, with significant backing for the initiative.

The ECB announced the launch of the Securities Market Programme, involving the purchase of sovereign bonds in secondary markets to address severe tensions in financial markets.

On October 15, 2010, ECB President Jean-Claude Trichet sent a secret letter to the Irish finance Minister warning about the possible suspension of ELA's credit lines unless the government requested financial assistance and implemented reforms. The ECB played a key role in preventing Anglo Irish Bank from defaulting on its debts.

On November 6, 2010, ECB President Jean-Claude Trichet sent another secret letter to the Irish finance Minister regarding the suspension of ELA's credit lines unless the government sought financial assistance and committed to reforms. The ECB's involvement aimed to avoid financial instability risks.

In April 2011, the ECB raised interest rates for the first time since 2008 from 1% to 1.25%, signaling a shift in monetary policy. Subsequent rate increases followed in July 2011. However, the ECB later lowered interest rates significantly to stimulate economic growth.

Jürgen Stark resigned in protest against the Securities Market Programme, which he considered equivalent to monetary financing and prohibited by the EU Treaty.

In November 2011, Mario Draghi assumed the position of the President of the European Central Bank. There were concerns about his stance on inflation compared to his predecessor, Jean-Claude Trichet.

In December 2011 and January 2012, the ECB implemented LTROs to inject liquidity into the Eurozone financial system post the Global Financial Crisis, aiming to stabilize financial institutions.

As of June 2012, the ECB had spent €212.1bn on bond purchases as part of the Securities Markets Programme, equal to 2.2% of the Eurozone GDP.

On 26 July 2012, ECB President Mario Draghi announced the 'Whatever it takes' policy to save the Euro, signaling the central bank's commitment to preserving the single currency. This statement was a turning point in addressing the Eurozone crisis.

Following Mario Draghi's speech declaring the ECB's readiness to preserve the Euro, the ECB announced the OMT program on September 6, 2012. The program had no ex-ante time or size limit but was conditioned on the benefitting country adhering to an adjustment program to the ESM.

The ECB cuts the rate on overnight deposits from banks to below zero for the first time ever, implementing a negative interest rate policy.

In response to a decline in Eurozone inflation rate, the ECB announced the launch of CBPP3 and ABSPP on September 4, 2014, to address the threat of deflation.

On January 22, 2015, the ECB announced an extension of bond buying programs to a full-fledged quantitative easing initiative, including sovereign bonds, to address economic challenges.

The ECB expanded its asset purchases portfolio by including corporate bonds with the launch of the corporate sector purchase program (CSPP) on June 8, 2016, aiming to stimulate the economy.

The European Central Bank ends its bond-buying stimulus program after 2.6 trillion euros in purchases.

Citing risks from trade disputes and low inflation, the ECB board decides to re-start the bond purchases at a rate of 20 billion euros per month, indefinitely, and cuts the deposit rate to minus 0.5%.

In response to economic crises in Europe, the European Central Bank (ECB) implemented aggressive monetary policies that redefined its original mandate. These policies aimed to address the challenges posed by the crises and stabilize the economy.

The ECB announced the launch of the PEPP worth €750 billion to boost liquidity in the European economy and contain sharp increases in sovereign yield spreads due to the pandemic. This marked a deviation from the usual approach of prodding fiscal authorities into action before announcing monetary stimulus.

On April 30, 2020, the Governing Council of the ECB adopted temporary measures to adjust the TLTRO III framework, widening the collateral assets and reducing interest rates for banks to enhance access to credit for firms and households during the COVID-19 pandemic.

On May 5, 2020, the German Federal Constitutional Court ordered a proportionality assessment of the ECB's government debt purchases in the Public Sector Purchase Programme (PSPP). This ruling raised concerns about the legality of the ECB's actions and highlighted mistrust in some parts of Germany towards the institution.

The ECB announced an expansion of the PEPP by another €600 billion, bringing the total emergency package up to €1.350 trillion in response to the ongoing economic impact of the pandemic. This decision showcased the ECB's commitment to price stability.

The ECB announced the final expansion of the PEPP worth another €500 billion, totaling the final PEPP to €1.850 trillion. This corresponded to 15.4% of the euro-area GDP of 2019, and the ECB also extended the horizon for net purchases of the PEPP until at least the end of March 2022.

As a result of a strategic review led by the new president Christine Lagarde, the European Central Bank officially abandoned the 'below but close to two per cent' definition and adopted a 2% symmetric target for inflation.

On July 13, 2021, the ECB presented the outcomes of its strategy review, announcing a new inflation target of 2% and incorporating the cost of housing into its inflation measurement. The ECB also revealed plans for climate change action and another strategy review in 2025.

On March 31, 2022, at the end of the net purchases, the ECB had purchased €1.718 billion euros under the PEPP, with a majority invested in public sector securities. This decision was influenced by decreased financial stress in the Euro Area due to the relaxation of COVID restrictions and the reopening of European markets.

The ECB introduced the Transmission Protection Instrument (TPI) on July 21, 2022, as a tool to ensure smooth transmission of monetary policy decisions across all euro area countries. It allows the ECB to purchase securities in the secondary market to counter unwanted market dynamics and reduce fragmentation risk.