ECB to raise funding for Greek banks, QE to kick off 9 March

The European Central Bank (ECB) has raised emergency liquidity assistance for Greece by €500m and announced that it has removed the waiver on purchases of the nation's debt.

Speaking at a press conference after the ECB unsurprisingly announced it would keep its main refinancing rate at 0.05% and deposit facility at -0.20%, President Mario Draghi said the monetary authority stands ready to reinstate the waiver as soon as successful review is completed.

Draghi also revealed that the ECB's €1.1trn quantitative easing programme would begin on 9 March and carry through at €60bn a month through September 2016 and thereafter if needed.

Greece and Cyprus are exempt from the programme until certain conditions are met.

"We assessed these conditions were not in place in mid-February. At that point we had not choice," Draghi said.

The ECB also raised its gross domestic product (GDP) projections for 2015 to 1.5% from 1% and 2016 estimates were revised to 1.9% from 1.5%. The central bank sees GDP moving towards 2.1%.

Draghi said the raised GDP forecasts were supported by expectations that the latest policy measures will boost recovery and low oil prices will lift disposable income.

He said policy measures should also help push inflation back toward its target of just below 2%. The ECB expects inflation of 1.8% in 2017. It is expected to average 0% in 2015 on subdued oil prices.

Oanda senior market analyst Craig Erlam highlighted the negative reaction to the ECB's inflation projection for 2017 which is deemed to be not close enough to target.

"All things considered, I will be very surprised if this programme does not run past September next year, which Draghi did leave the door open to."

BNP Paribas analyst Ken Wattret says he expected the inflation projections to be raised by less.

The euro fell 0.47% to $1.1026 at 16:13.