The ECB meeting was promising to deliver fireworks and did just that as the central bank surprised by cutting rates and announcing a private QE. Expectations were high heading into the meeting and the ECB certainly went above and beyond. It delivered cuts to the main refinancing rate (10 basis points), marginal lending facility (10 basis points) and also pushed the deposit rate (10 basis points) deeper into negative territory.
On top of that, the ECB will engage in private asset-backed securities and covered bond purchases which will run in conjunction with the TLTRO. The ECB hopes this will help expand its balance sheet by EUR1 trillion, which would match early 2012 levels. However, it seems the technicalities of the expansion are yet to be completely worked out, with details set to be fleshed out at the October meeting.