3 Jul 2015
ECB’s QE tapering unlikely – Rabobank
FXStreet (Edinburgh) - Strategist at Rabobank Elwin de Groot does not expect the ECB QE programme to end before September 2016.
Key Quotes
“With spare capacity still at significant levels, the eurozone economy still looking susceptible to various downside risks and the recent pickup in inflation being largely driven by cost-push factors, we argue that the ECB has sufficient reasons to maintain its forward guidance and continue its purchase program until its intended date of completion (September 2016)”.
“This should help keep a lid on money market rates. If anything, short-term rates may still fall back further under the weight of rising excess liquidity”.
“This should also help contain (but not stop) upward pressure on long-term rates, which – despite the Greek turmoil – appears to be raising its head again”.
Key Quotes
“With spare capacity still at significant levels, the eurozone economy still looking susceptible to various downside risks and the recent pickup in inflation being largely driven by cost-push factors, we argue that the ECB has sufficient reasons to maintain its forward guidance and continue its purchase program until its intended date of completion (September 2016)”.
“This should help keep a lid on money market rates. If anything, short-term rates may still fall back further under the weight of rising excess liquidity”.
“This should also help contain (but not stop) upward pressure on long-term rates, which – despite the Greek turmoil – appears to be raising its head again”.