ECB: Reduction in asset purchases likely to be announced in September meeting - BBH

Sandeep Kanihama FXStreet Contributor

In view of analysts at BBH, news from the Eurozone is unlikely to dampen expectations that the ECB will announce in September plans to scale back its asset purchases starting next year.

Key Quotes

“Many investors have concluded that the ECB expanding its balance sheet around 180 bln euros in H1 18 (vs. 360 bln euros in H2 17) is somehow more supportive of the currency than the Fed likely shrinking its balance sheet $150 in H1 18. It does bring forward the day that the ECB may begin raising rates, but remember, it is beginning with its deposit rate at minus 40 bp. If it is hiked to minus 20 bp in H2 18, is that really a tightening? And isn't it reasonable to expect the Fed to hike again before this happens?”

Author

Sandeep Kanihama

FXStreet Contributor

Sandeep Kanihama is an FX Editor and Analyst with FXstreet having principally focus area on Asia and European markets with commodity, currency and equities coverage. He is stationed in the Indian capital city of Delhi.

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