ECB: further rate cuts on the cards? - Nomura

Analysts at Nomura explained that the ECB provided little excitement to the market, with ECB President Draghi saying that the board did not discuss specific changes to the design of the PSPP, though committees will conduct an assessment of this in the coming weeks.

Key Quotes:

"Important to note, the ECB did not exclude the use of further rate cuts. The ECB indicated at the September meeting that it would not increase accommodation if its scenario in terms of inflation and activity was realised; by contrast, our economists factor in more negative risk on activity and inflation between now and December, which would require the level of accommodation to increase. For the ECB to change its stance, downside risks to activity and inflation will need to materialise, otherwise March 2017 might actually be the beginning of “tapering” for the ECB bond-buying programme."