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3 Sep 2015
ECB’s QE could be in the spotlight today – Danske Bank
FXStreet (Edinburgh) - Kasper Kirkegaard, Chief Analyst at Danske Bank, believes today’s ECB message could be focused on the inflation figures in the region and the QE programme.
Key Quotes
“Market expectations for today’s ECB meeting are for Draghi to reiterate and emphasise the ECB’s willingness to fight the deflationary risk that is threatening its inflation outlook”.
“We believe Draghi will deliver according to expectations by providing a dovish and slightly worried message”.
“We do not expect the ECB to present any changes to the current policy but an possible extension of the QE programme or firmer forward guidance framework (either on rates or scope of the QE programme) should lead to a fixed income rally driven by the 5y and 10y segment”.
“Should the ECB not live up to expectations by e.g. sounding too confident on its inflation projections, a material setback in rates markets should be regarded as a buying opportunity with the dis-inflation theme still having legs as the markets price in very low inflation expectations”.
Key Quotes
“Market expectations for today’s ECB meeting are for Draghi to reiterate and emphasise the ECB’s willingness to fight the deflationary risk that is threatening its inflation outlook”.
“We believe Draghi will deliver according to expectations by providing a dovish and slightly worried message”.
“We do not expect the ECB to present any changes to the current policy but an possible extension of the QE programme or firmer forward guidance framework (either on rates or scope of the QE programme) should lead to a fixed income rally driven by the 5y and 10y segment”.
“Should the ECB not live up to expectations by e.g. sounding too confident on its inflation projections, a material setback in rates markets should be regarded as a buying opportunity with the dis-inflation theme still having legs as the markets price in very low inflation expectations”.