Brian Martin, Senior International Economist ANZ explained that the ECB meeting acknowledged the recent loss of momentum in euro area economic activity.
Key Quotes:
“But the Governing Council does not see recent weakness as sufficient to alter their baseline assessment that a broad based recovery is in place.”
“A reassessment of the baseline outlook and discussion on the future policy path will take place in December, when the ECB has the updated macroeconomic projections. Until then, data watching will be crucial. The ECB next meets 13 December.”
“For the moment, forward guidance remains unchanged and the ECB is committed to ending QE in December. ECB President Draghi said that a couple of members of the council raised the possibility of new TLTROs as a policy tool available to the ECB.”
“The euro recovered marginally during the press conference but soon gave back its gains. Expectations that continued weak data could lead to some softening in the ECB’s forward guidance should weigh in the currency near term.”
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