The amount of the securities bought by Latvijas Banka is reflected in its monthly balance sheet (https://www.bank.lv/en/about-us/reports/lb-monthly-balance-sheet), while information on the execution of the expanded asset purchase programme (EAPP) in the Eurosystem as a whole is available on the ECB's website at: http://www.ecb.europa.eu/mopo/liq/html/index.en.html#portfolios. Securities issued by the Latvian government are purchased by Latvijas Banka and the ECB in the secondary market.
The securities purchase programme was launched in March 2015 pursuing the Eurosystem's (comprising the ECB and national central banks of the euro area) primary objective of keeping inflation rates below, but close to, 2% over the medium term. The expanded asset purchase programme encompasses three programmes: the PSPP, CBPP3 (the covered bond purchase programme) and ABSPP (the asset-backed securities purchase programme).
The duration of the EAPP is from March 2015 to the end of September 2016 (19 months) or until the ECB sees a sustained adjustment of the inflation level towards the price stability objective. The target amount of monthly securities purchases under the APP will be 60 billion euro or more than a trillion euro during the 19 months. Further information about the programme is available at: http://www.ecb.europa.eu/mopo/implement/omo/pspp/html/pspp.en.html.
As a result of the EAPP, the Eurosystem will exchange the less liquid assets (securities) available in the financial market for the highly liquid funds. This intervention is expected to affect the euro area economy through the monetary transmission mechanism. The intervention will improve confidence indicators of the euro area, cut interest rates, enhance lending recovery, stimulate aggregate demand and production capacity utilisation, leading to increased economic growth and a rise in inflation. More detailed analysis of APP economic aspects and its impact on the euro area and Latvia is available in the article: https://www.makroekonomika.lv/eirosistemas-monetara-politika-skersgriezuma-soreiz-par-papp
Depending on the place of PSPP securities storage, the Eurosystem can offer various lending possibilities of PSPP securities. International central securities depositories, i.e. the Euroclear Bank and Clearstream Banking Luxembourg, where Latvian government securities are held, ensure automatic securities lending programmes for them. Securities borrowing is also possible via agents*.
The Governing Council, which is the main decision-making body of the ECB, takes monetary policy decisions of the Eurosystem. It consists of the six members of the Executive Board and the governors of the national central banks (including Latvijas Banka) of the 19 euro area countries. The Governing Council of the ECB takes the decisions necessary for the functioning of the Eurosystem and formulates monetary policy for the euro area. This includes setting monetary objectives and key interest rates, as well as the supply of reserves of the Eurosystem.
* Securities available for lending: