The European Central Bank (ECB) will announce on Thursday a widening over time of the asset purchase program until September 2017 — without interfering in the reference interest rates – and, according to some analysts consulted by Lusa news agency.
The meeting of the monetary policy of the ECB is held on the morning of this Thursday at the institution’s headquarters, in Frankfurt, followed by the usual press conference.
The factor of greatest uncertainty, in our opinion, resides in the amount of purchases that will be announced for the six-month extension of the market. Will the ECB keep the shop current at 80 billion euros a month after march, or will announce that the amount will be lower, going back perhaps to the 60 billion euros/monthly?", questioned the analyst’s financial Banco BPI Teresa Gil Pinheiro.
Also for the economist with Banco Carregosa Rui Barbara the great curiosity at this time in the market is to know what will the ECB decide on the plan of purchase of assets (mainly public debt) that set in motion to help tackle the crisis of the financing of some euro area countries, the so-called 'Quantitative Easing' (QE). The date established for the end of the help of the ECB was to march 2017.
"A little more than three months of that date, is already more or less consensual that the QE will not end abruptly in march. For this reason, governments, banks and investors expect Mario Draghi to announce a prolongation. The big question is the extent to which the ECB has leeway to continue to buy 80 billion euros of assets," he explained. Among the scenarios mentioned, he continued, is the extension of the date, with a reduction of the amount of the purchases, maintenance of the amount of the purchases and indication of the end date of the plan, or not setting of the end date, but "to ensure that this help is not eternal".
On the same line, the chief economist at Montepio Geral, Rui Bernardes Serra, anticipates the extension of time in the program at least until September, "with a probability of 50% that the pace of monthly purchases could be lower than the current, from march (the end of the current program)". At the last meeting, signaled, Draghi admitted he was very little likely to attend to a sudden interruption of the current program, suggesting the existence of a period of gradual reduction in the pace of asset purchases.
To the manager of brokerage firm XTB, Eduardo Silva, "this meeting will be the most important of the last few months and the speculation is total". On the one hand, he says, there is expectation that it may be announced a new round of stimulus, since the political instability has been increasing. On the other hand, continues, "the optimism from Draghi on the latest interventions, coupled with the good economic data, make it also possible that the body choose to keep everything unchanged, while observing the indicators of the next few months to take a position".
The asset manager of the’orey Financial, José Lagarto, said: "with the danger of deflationary, for now, to stay away and the economic recovery is increasingly becoming a reality, it is plausible to question whether it will be in the plans of the ECB to the beginning of the withdrawal of the asset purchase program". "But the ECB will have to weigh the implications of the medium-term of the recent events, in some way disruptive, as were the election of Donald Trump in the us and the "No" to the amendment of the constitution in Italy, which leads the country to a crisis of government", signalled. You will still have, he continued, to cope with the formalization of the output of the United Kingdom of the European Union, and a probable increase in interest rate by the us Federal Reserve (Fed) in the next week.
The chief economist of Allianz Global Investors, Franck Dixmier, it was estimated also that, "very likely", the ECB will extend its asset purchase program between six and nine months.
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