"Rather than explicitly increasing the size of monthly purchases by €20bn and extending the program to December 2016, though, we now think it is more likely the ECB tries to get a similar impact by moving to QE infinity and leave the end date premised only on when they feel they are likely to achieve their goals.
And while before we simply saw good risk/reward in being positioned for rate cuts given a 50% chance, we think a cut of 15-20bps in December is now likely, with an outside chance of a further 20bps of easing beyond that. This means that at a minimum, fair value for schatz should be around the –45 to 50bps range."
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