ECB intervention has pushed European corporate bond yields down to unrealistic levels. It may therefore be a good idea to buy some sterling credit, regardless of how the Brexit saga will play out.
The European Central Bank decided to stick rather than twist today as it announced the deposit rate has been held at -0.4%, the refinancing rate held at zero, and the details of its €80bn per month quantitative easing programme are unchanged.
As France and other parts of the eurozone return to work after an August on the beach or in the countryside, the focus of investors turns once again to Mario Draghi and the European Central Bank.
Prolonged political uncertainty and flaws in the institutional framework have kept eurozone equity premium risk at its highest level since the ‘09 global financial and ‘11 eurozone crises, according to new data by NN Investment Partners.
No changes to the European Central Bank’s monetary policy stance was announced at its meeting on Thursday; as it chose to maintain the deposit rate at -0.4%.
Faced with stubbornly low inflation the European Central Bank has taken a leaf out of the Bank of Japan’s playbook.
Mario Draghi’s decision to extend the European bond buying programme has inspired several fund managers to dip their toes in the corporate bond pool, but no one knows how it will pan out, according to Chelsea Financial Services managing director, Darius McDermott.
Banks do derive benefits from negative interest rates, which are a net positive for the economy, said José Viñals director of monetary and capital markets at the IMF.
Quantitative easing is far from finished as central banks realise procrastination will not halt deflationary forces.
Last Thursday was a big day for Draghi. After disappointing in December, he couldn’t afford to underwhelm markets again. And to be fair, he didn’t.
The greatest impact on real economic activity throughout Europe will come from fiscal measures rather than any more monetary stimulus, according to head of European equities at Fidelity International Paras Anand.
Fund managers weigh in after ECB president Mario Draghi jolted markets with his bold monetary policy moves.
