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ECB: Do not expect changes to QE in 2017 - BNPP

With the risk of deflation having significantly diminished, the ECB is set to go ahead with a reduced pace of asset purchases until December 2017 expects research team at BNP Paribas.

Key Quotes

“Until a sustained rise in underlying inflation is observed – something we believe is unlikely until H2 2017, the earliest – the ECB will maintain its sustained presence in the markets. It preserves a high degree of flexibility with an asymmetric reaction function, given the subdued, underlying inflation and only moderate growth. Against this backdrop, we do not expect any changes to the QE programme over the course of 2017, with the programme eventually coming to an end in 2018.”

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