ECB Liquidity Is Not Fungible For Emerging Markets
BARCLAYS | We believe a further expansion in ECB QE will only have regional, and overall limited , effects on EM. Extending the discussion to the effect of BoJ QE, we come to similar conclusions.
QE
Offset here, offset there, offset everywhere
James Alexander via Historinhas | There is only monetary policy, defined as the value of money relative to real goods and services. All else is just tools: official short term policy rates, IOER, targeting or guidance, QE, fiscal policy. In the “monetary offset”, the tool of expansionary fiscal policy is offset if the overarching policy tool is inflation targeting.
And the Winner is (should be)…. Fiscal Policy!
PARIS | By Francesco Saraceno | So, Mario Draghi is disappointed by eurozone growth, and is ready to step up the ECB quantitative easing program. The monetary expansion apparently is not working out as planned.
ECB unlikely to change the message that it intends to implement QE “in full”
LONDON | June 3, 2015 | UBS | The fact that the Eurozone’s headline inflation pick-up was related not just to headline HICP but also to core inflation will be acknowledged positively by President Draghi in today’s press conference. Yet, the ECB will be careful not to deviate from the message it has given in recent months.
ECB purchases will reduce the size of the tradable sovereign bond markets
MADRID | May 14, 2015 | BNP Paribas | Net issuance of sovereign bonds will exceed ECB purchases in May by c.EUR50bn. We believe this is why yields are going up. We also believe this is why they will come down again from June when ECB QE will again significantly outpace sovereign bond issuances (by c. EUR8bn in June and EUR90bn in July)
Stronger credit lending in Spain… to the public sector
MADRID | May 7, 2015 | By Luis Arroyo | Credit lending to the private sector (households and companies) continued to fall in March, according to the Bank of Spain. So as a matter of fact there is more lending activity in the country, yet the money is going to the public sector.
BNP sees risks in QE implementation
The Corner | April 30, 2015 | For BNP Paribas analysts Mario Draghi will find it increasingly difficult over the next few months to execute its planned EUR45bn monthly purchases of sovereign bonds.
Eurozone credit lending sees first rise since 2012
The Corner | April 29, 2015 | Is the eurozone’s private sector finally turning a corner? For the first time in three years, lending to households and firms rose in March (0.1% y-o-y), European Central Bank data showed on Wednesday, partly thanks to the QE iniciative.
Euro area: Don’t fight the ECB
LONDON | April 21, 2015 | Barclays | The ECB remains committed to deliver its QE target of a more than €1.1trn balance sheet expansion through asset purchases and sought to dispel fears over asset scarcity.
ECB’s QE programme allows Spain to enter negative yield club
MADRID | April 9, 2015 | By Francisco López | The flurry of good news on the Spanish economy in an election year should be treated with caution. This week the Spanish Treasury placed Treasury letters at negative yields for the first time ever. However it should also be noted that half a dozen European countries have reached this level already and that the driving force behind the historical lows is undoubtedly the ECB’s QE programme.