27 May 2014
Draghi in a corner - BBH
FXStreet (Guatemala) - Marc Chandler, Global Head of Currency Strategy at Brown Brothers Harriman explained It has taken Draghi a while, but he has now managed to paint the ECB into a corner.
Key Quotes
"Over the weekend, he discussed the “potential for a negative spiral to take hold between low inflation, falling inflating expectations and credit.”"
"If the ECB does not ease in a strong fashion, it risks losing some credibility in its communication. It could trigger new appreciation of the euro, which has broken below its 200-day moving average for the first time since last September."
"Anticipation of ECB action has helped fan the equity market. European shares have rallied for six consecutive weeks, with the Dow Jones Stoxx 600 advancing about 5%."
Key Quotes
"Over the weekend, he discussed the “potential for a negative spiral to take hold between low inflation, falling inflating expectations and credit.”"
"If the ECB does not ease in a strong fashion, it risks losing some credibility in its communication. It could trigger new appreciation of the euro, which has broken below its 200-day moving average for the first time since last September."
"Anticipation of ECB action has helped fan the equity market. European shares have rallied for six consecutive weeks, with the Dow Jones Stoxx 600 advancing about 5%."