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5 Jun 2014
ECB could leave door open for more stimulus - Investec
FXStreet (London) - Jonathan Pryor, Corporate Treasury Analyst at Investec believes that ECB President could leave the door open for US QE style stimulus measures.
Key Quotes
"Today is a big day with central bank interest rate announcements from the Bank of England and crucially the European Central Bank. The Bank of England should pass by uneventfully with no policy change or accompanying statement - the minutes published later this month will be more important to see the continuing debate over the amount of slack in the economy."
"The ECB as we have mentioned previously look set to take steps to curb prolonged low inflation and slow growth, particularly in the periphery. These are expected to include a cut to all three main rates by around 10-15bp, which would take the deposit rate into negative territory."
"There is a lot of speculation that additional liquidity measures such as stopping the weekly drain operation leaving more euros in the system, a targeted LTRO scheme to help SMEs and even small scale buying of private sector assets could be introduced. A widescale QE program like that adopted by Federal Reserve looks unlikely today, although the market will be watching carefully to see if Draghi leaves the door open for this in coming months."
Key Quotes
"Today is a big day with central bank interest rate announcements from the Bank of England and crucially the European Central Bank. The Bank of England should pass by uneventfully with no policy change or accompanying statement - the minutes published later this month will be more important to see the continuing debate over the amount of slack in the economy."
"The ECB as we have mentioned previously look set to take steps to curb prolonged low inflation and slow growth, particularly in the periphery. These are expected to include a cut to all three main rates by around 10-15bp, which would take the deposit rate into negative territory."
"There is a lot of speculation that additional liquidity measures such as stopping the weekly drain operation leaving more euros in the system, a targeted LTRO scheme to help SMEs and even small scale buying of private sector assets could be introduced. A widescale QE program like that adopted by Federal Reserve looks unlikely today, although the market will be watching carefully to see if Draghi leaves the door open for this in coming months."