(1/8) #ECB today published an update on govvie purchases under PEPP (Aug-Sep) & PSPP (Sep) which shows the huge benefit from PEPP in terms of purchase pace & capital key deviation during times of stress.
(2/8) For example, total PEPP purchases of non-supra govvies slowed in Aug/Sep from EUR184BN in June/July to only EUR121BN. Partly this is seasonal, as August is a stale month for markets. But this also reflects the prior need to front load PEPP purchases.
(3/8) In terms of flexibility, chart shows share of PEPP govvie purchases over the 3 periods for which data is available. In Aug/Sept, as well as slowdown in purchases, deviations from capital key were much smaller than earlier this year. 
(4/8) #Italy has consistently benefitted from a greater purchase share relative to capital key (17%) but this slowed in Aug/Sept. #Spain has also, but less. Relative German and French under-purchases provided an offset.
(5/8)Total purchases of govvies across the euroarea in Aug/Sept and since March, in both PEPP and PSPP, shown below. Also shows expected purchases based on capital key alone (assuming Greece is in PSPP for simplicity.)
(6/8) Total PSPP/PEPP govvie purchases were close to capital key over summer, w/ #France being slightly “over purchases” w/ Italy & Spain & many others marginally “under purchased.” Since Mar, German & Dutch govie purchases have allowed for excess purchases in Italy and Spain.
(7/8) 2 observations: 1. while there has been normalisation of purchases over summer relative capital key, there is still substantial “catch up” towards capital key needed for Germany & relative under purchases of Spain Italy, though horizon over which will happen not clear.
(8/8) 2. PEPP flexibility served successfully as "yield spread control” as opposed to yield curve control. This feature of PEPP is something #ECB Gov Council could carry forward following monetary policy strategy review, but whether this will be legally possible remains unknown.
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