Home ECB running out of available action, Fed 2016 trajectory

ECB running out of available action, Fed 2016 trajectory

Neil MacKinnon, Global Macro Strategist for VTB Capital, joined Zak Mir and Mike Ingram on the Tip TV Finance Show to discuss the reaction to the ECB meeting and the assumed Fed rate hike and trajectory of tightening into 2016.


Key Points:

MacKinnon noted that even though the deposit rate was cut and QE was extended, the monthly rate of bond purchases remained unchanged at 60 billion.

The ECB are unlikely to act again in the near-term, as they are running out of possible policies to use.

He continued to the Fed meeting next week, with lift-off looking more likely, but MacKinnon expected the rate trajectory to be dovish in 2016.

MacKinnon believed the Fed will look for one hike in March after the initial December rate rise, but after that with the US and global economy looking relatively uncertain, and the US being in a Presidential election year, another hike is unlikely.

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