1 May 2015
Credit Agricole : Is this the end of EUR-funded carry trades? – eFXnews
FXStreet (Barcelona) - According to Credit Agricole, it is premature to expect that ECB might adjust its QE purchases anytime soon, as noted by eFXnews.
Key Quotes
“EUR remains surprisingly resilient as investors worry that the ECB may taper its QE before long in the face of returning inflation and recovering economy. This is pushing short rates and EUR higher as EUR-funded carry trades get unwound.”
“Is this the end of EUR-funded carry trades? We doubt it. We think it is premature to expect that the ECB will be adjusting QE anytime soon. Indeed, Eurozone inflation expectations have stabilised but remain close to the lows. In addition, Greece will remain a worry even as hopes for a deal between Athens and its creditors are growing ahead of the 11 May Eurogroup meeting.”
“In particular, we think that fears about Grexit could intensify again once Athens and its creditors start negotiating a third sovereign bailout later on this year.”
This content has been provided under specific arrangement with eFXnews.
Key Quotes
“EUR remains surprisingly resilient as investors worry that the ECB may taper its QE before long in the face of returning inflation and recovering economy. This is pushing short rates and EUR higher as EUR-funded carry trades get unwound.”
“Is this the end of EUR-funded carry trades? We doubt it. We think it is premature to expect that the ECB will be adjusting QE anytime soon. Indeed, Eurozone inflation expectations have stabilised but remain close to the lows. In addition, Greece will remain a worry even as hopes for a deal between Athens and its creditors are growing ahead of the 11 May Eurogroup meeting.”
“In particular, we think that fears about Grexit could intensify again once Athens and its creditors start negotiating a third sovereign bailout later on this year.”
This content has been provided under specific arrangement with eFXnews.