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ECB Watch: Taper without tantrum
The end of net purchases does not mark the end of very loose policy. In fact, Draghi sounded dovish today, and we still expect the first rate hike only in December 2019. Today’s message is supportive of receiving strategies and further EUR weakness. End of bond purchases does not signal quick rate hikes • Net asset purchases will end at the end of 2018, subject to incoming data. • Rates will remain at present levels at least through the summer of 2019 and in any case for as long as necessary. • The announcement of the end of net purchases was softened by Draghi’s dovish language. • We continue to expect ... (full story)