The European Central Bank’s monthly monetary policy meeting which concluded on Thursday, November 8, showed that the central bank had extended its bond purchases from March 2017 to the end of 2017. The decision to extend QE takes the central bank’s total size of QE purchases above EUR 2.2 trillion. The central bank chief, Mario Draghi insisted that there was no question of the ECB tapering its QE program even after the monthly purchases were cut by a third.

The ECB president revealed that policy makers were split over the central bank’s decision. The ECB announced that it would cut its monthly bond purchases from the current EUR80 billion to EUR60 billion from April next year. Experts were expecting the ECB’s QE program to continue at the pace of EUR80 billion until September.

So while there was a disappointment in that the ECB lowered its bond purchases, Draghi made up for it by extending until the end of 2017. As a result, the euro fell sharply on the day, despite initially posting intraday gains ahead of the ECB’s decision.

“It took everyone a bit of time to make their maths. They’re actually going to buy more than expected,” said Olivier de Larouzière, head of interest rates at Natixis Asset Management.

In the ECB’s press conference, Mr. Draghi said that the central bank’s governing council reached a “very, very broad consensus” that the bond purchases could continue beyond 2017 if they felt it was necessary to lift inflation back to the central bank’s 2% target rate.

The single currency initially rose to a two-month high against the greenback as the ECB lowered its QE amount, but soon tumbled as the central bank signaled an extension to the QE program for nine months. EUR/USD fell 1.3% to $1.0615 from the intraday high at $1.0874. The EUR/GBP was weaker, losing 1.0% to 0.8433. However, by Friday morning there were signs that the initial euphoria was already fading as the markets turn focus to next week’s FOMC meeting where the Fed is expected to hike rates for the second time.