Goldman Sachs on the ECB

We expect the overall tone of the Introductory Statement and ECB President Draghi's comments at his press conference to be broadly unchanged from the October meeting. Looking ahead, we continue to expect the APP to run until end-2018 (with a 3-month extension to be announced in June/July). Recent comments suggest risks are skewed towards no extension. We expect the ECB to maintain its expected policy sequencing and not raise rates until "well past" the end of net asset purchases and to use forward guidance as its marginal policy tool in the coming quarters. We expect the ECB's forward guidance at some point to change towards linking the future rate path more directly to inflation developments. We forecast the first policy rate hike in the second half of 2019.

14 Dec 2017 - 08:15- Bank Speaker- Source: Goldman Sachs

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