ECB may need to change its QE purchase limits - SocGen

Research Team at Societe Generale, notes that the ECB meeting in July was uneventful, with most governors appearing to opt for a wait-and-see approach to the Brexit referendum.

Key Quotes

“The next ECB meeting will be held on 8 September (with staff projections for 2016-18 real GDP and inflation).

Following the sharp fall in Eurozone interest rates, SG economists believe the ECB may need to change the limits of its asset purchases very soon to reassure observers that it can continue QE until March 2017. Our economists expect an increase in the issue share limit to above the current 33%.

In addition, the ECB could decide to extend the horizon of the asset purchases from March until September 2017.”