6 Mar 2014
Flash: Some still seeing a cut from ECB – RBS
FXStreet (Guatemala) - Strategists at RBS explained, following the firmer than expected CPI inflation data last Friday and firmer region wide EC survey data last week, RBS Economics changed its call for a rate cut to no change at the ECB policy meeting later today.
Key Quotes:
“This is the prevailing mood on the street, but there are some that are still seeing a rate cut, and/or other easing measures such as no longer sterilizing the government bond purchases made during the 2010/11 phase of the crisis using the Securities Market Program (SMP)”.
“Some might say the ECB is more likely to change policy when they face less pressure from the market to do so. As such, with inflation still well below target, arguably too far below, the ECB could still further ease policy today”.
“The EUR might dip on further easing, and it may currently be reluctant to go up ahead of the ECB meeting. However, if they ease, the downside is likely to be relatively limited, and if they don't it might rise strongly”.
Key Quotes:
“This is the prevailing mood on the street, but there are some that are still seeing a rate cut, and/or other easing measures such as no longer sterilizing the government bond purchases made during the 2010/11 phase of the crisis using the Securities Market Program (SMP)”.
“Some might say the ECB is more likely to change policy when they face less pressure from the market to do so. As such, with inflation still well below target, arguably too far below, the ECB could still further ease policy today”.
“The EUR might dip on further easing, and it may currently be reluctant to go up ahead of the ECB meeting. However, if they ease, the downside is likely to be relatively limited, and if they don't it might rise strongly”.