ECB to stay on message - AmpGFX

In view of Greg Gibbs, Analyst at Amplifying Global FX Capital, the ECB monetary policy meeting and press conference on Thursday is not expected to make any changes to its policy outlook; i.e. for a further tapering of its asset purchase in October from EUR30bn to 15bn per month, and to zero in January, and no rise in its negative rates “at least through the summer of 2019.”

Key Quotes

“The economic activity and inflation data in recent months are stable overall and suggest that there will be little change in staff projections for growth and inflation.”

“However, market indicators are weaker, including a significant further decline in European equities, particularly bank share prices, reflecting weaker EM markets and Italian bonds.”

“As such, we should expect ECB President Draghi to continue to sound cautious and highlight risks to the outlook, even though the text in the opening statement is likely to retain a “broadly balanced” view of risks around growth and inflation.”