ECB: No change expected, Draghi’s comments to be closely watched - Lloyds

Analysts from Lloyds Bank explain that next week, among the most important economic events is the European Central Bank meeting. They expect no change in monetary policy as the central bank is “in the midst of implementing relatively new stimulus measures, including corporate bond purchases that began last month.”

Key Quotes:

“Looking beyond the UK, the key focus will be on the ECB announcement (Thu). No policy change is expected, with the ECB.”

“President Draghi’s comments at the press conference, however, will be closely watched. In particular, markets will examine his assessment of any potential impact of Brexit and concerns about the Italian banking sector, although new staff economic forecasts are not scheduled to be updated until the next meeting in September.”

“The terrible attacks in southern France on Bastille Day, which left scores dead, could also have an impact on economic confidence. On a more technical level, Mr Draghi is likely to get questions about the potential scarcity of German government bonds that the ECB can buy under current rules and whether some of the rules – such as the deposit rate floor, issue limits and the weighting according to the capital key – may be revisited in the near future.”