Previously
on MoreLiver’s:
W/E: Weekly Support (updated)
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ECB
preview: No QE under the Christmas tree – TradingFloor
A recent
string of dovish speeches by ECB members have taken QE speculation to near
fever pitch. But today is a bit too soon for an announcement.
The Fed
and ECB differ sharply on the oil shock – FT
Four
things to watch for at today’s ECB policy meeting – FT
Draghi
to talk the talk, no walk yet – Reuters
ECB May
Have Little Choice but Sovereign QE – WSJ
Five
Questions for Mario Draghi From Asset Purchases to TLTROs – BB
Draghi
Tests Speed Limit as ECB Awaits Stimulus Evidence – BB
DEC-3
The
ECB’s Balance Sheet, if needed – Bruegel
The ECB has
become a safety net for dealing with near-insolvency conditions
What
Analysts Are Saying About The ECB's Big Decision Tomorrow – BI
ECB
preview - ECB's timeline is tricky - isn't it? – Danske
Bank
Without
Economic Reforms, Draghi's Easy Money Policy Is Powerless – BB
When
Will the ECB Move on Monetary Stimulus? – PIIE
Bundesbank
chief says manipulating currencies is "dangerous" – Reuters
5 Things
to Watch in the ECB’s December Meeting – WSJ
Has the
CBPP3 inadvertently created a stigma on euro area covered bonds? – Nordea
ECB Seen
Triggering 50% Jump in Asset-Backed Bond Sales – BB
Euro
area: Inflation to fall to zero – Nordea
With the
latest edition of the Economic Outlook we also updated our forecasts for the
Euro area. Not so much in terms of growth but for inflation that we now expect
to average just 0.3% y/y next year with a clear risk of several negative
monthly readings. A lower import bill supports real income and is good for
growth. However, given how low inflation and inflation expectations are, we
don’t expect the ECB to look just through it.
DEC-2
EUR inflation: Falling off a cliff – Nordea
The EUR
inflation market is panicking right now, and the 1Y inflation swap is printing below
zero for the first time since the immediate Lehman aftermath. With nominal
rates anchored, this is implicit tightening as real rates are soaring. This
puts immense pressure on the ECB and with Govie-QE unlikely for Thursday, and
the recent moves almost too much to ignore, lesser action is very much in play
right now.
Why is
euro inflation so low? – VoxEU.org
Eurozone
inflation has been persistently declining for almost a year, and constantly
undershooting forecasts. Building on existing research, this column explores
the conjecture that low inflation in the Eurozone results from an excess demand
for safe assets. If true, this conjecture would have definite policy
implications. Getting out of such a ‘safety trap’ would necessitate fiscal or
non-conventional monetary policies tailored to temporarily take risk away from
private balance sheets.
Investors see euro zone deflation in one year – Reuters
The ECB
must show leadership to fight threat of deflation – FT
Dovish
ECB waits for the December TLTRO – Danske
Bank
The
German euro is overvalued – Angry
Bear
DEC-1
Will the
ECB Start QE This Month? – WSJ
ECB
could fix euro zone flaw with risk-free bond: think tank – Reuters
As the
European Central Bank comes closer to buying sovereign bonds, one London-based
think tank says an opportunity has arisen to fix one of the euro zone's birth
defects -- the absence of a credible "risk-free" asset.
An end to the great European bank deleveraging? – FT
JPM:
“Although a large part of this year’s €700bn increase likely reflects valuation
effects of derivative books as we explain below, we see clear and encouraging
signs that the deleveraging of the previous two years has at least stopped.”
NOV-29
ECB
preview: An interim step ahead of sovereign QE next year – Nordea
The
question seems to be when, not whether the ECB will extend its asset purchases.
Time is not ripe for sovereign QE. However, we expect the ECB to extend the
purchases to investment grade corporate bonds and possibly also agency and
supranational bonds. Even such an outcome is unlikely to push bond yields much
lower in light of the falls already seen, while the euro should feel some
pressure. If we are wrong, Draghi will at least sound dovish and leave the door
wide open to new stimulus in Q1.
How
innovative should central banks be? – ECB
Keynote
speech by Sabine Lautenschläger, Member of the Executive Board of the ECB
ECB
bond-buying: last action hero – FT / Youtube
The
European Central Bank began its purchases of asset-backed securities to
stimulate the eurozone economy on Friday. But it is already looking at doing
more.
It's now
or never, Mr. Draghi
– TradingFloor
Stephen
Pope: Regional inflation in Eurozone at five-year lows * Bundesbank blocking
ECB's path to sovereign bond purchases * Italian unemployment hits highest
level since 1977
Inflation
declined - but ECB likely not to act next week – Handelsbanken
Draghi
needs support on QE in the eurozone – FT
The effect
of trying whatever it takes may raise expectations of inflation and growth by
itself
Europe’s QE front runners step up – FT
Markets
think it will happen but will not work