European stocks traded lower and the euro hung onto slight gains Thursday as the European Central Bank said it will reduce the rate of bond purchases.

The Stoxx Europe 600
SXXP,
-0.16%

lost 0.3% as the ECB said it would make bond purchases — using its Pandemic Emergency Program — at a “moderately lower” rate than the last two quarters. The index is within 2% of its record high set in August.

Economists had anticipated a step down in bond purchases from the roughly €80 billion per month it’s been making. Ahead of the meeting, the ECB’s chief economist had said any reduction would not be a “pure taper” but a “local adjustment.”

“To us, this is a small victory for the hawks as it signals that tapering will eventually be on the cards,” said Carsten Brzeski, global head of macro at ING.

The euro
EURUSD,
+0.18%

edged 0.1% higher. ECB President Christine Lagarde is due to hold a press conference at 8:30 a.m. Eastern.

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