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Analysts at Rabobank explained that the actions of European governments will also determine what path the ECB will take next.

Key quotes

“We have seen a first step in this direction in the Netherlands, for instance. And discussions in Germany are ongoing. But the extent to which Eurozone governments actually follow through with support for the economy, will also affect the short to medium term outlook for ECB policy.”

“Moreover, Mr. Draghi noted that the one thing all successful monetary unions have in common is some form of central fiscal capacity.”

“Whether European leaders will manage to create enough unity and support for a central fiscal institution will be crucial for Lagarde’s options going forward.”