ECB: balanced press conference, little new information - Westpac

 Tim Riddell, Research Analyst at Westpac, points out that Mario Draghi (again) conducted a finely balanced press conference and leave markets with little genuine new information.

Key Quotes: 

“The ECB avoided overt jawboning over EUR but cited that its strength was having a minor dampening effect on inflation pressures whilst also noting “volatility” as a source of concern. This would imply a cap should EUR move strongly whilst conceding the reasons why is stronger.”

“Tapering discussions have begun on a preliminary basis but are unlikely to be resolved by October and so full guidance is likely to be pushed out to December. Flexibility in APP suggested that periphery can be purchased to avoid scarcity issues, so narrowing spreads.”

“Forecast changes lifted current growth but lowered forward inflation whilst keeping forwarded growth unchanged.”