-
Policy
Policy
Exclusive interviews with leading policymakers that convey the true policy message that impacts markets.
LATEST FROM POLICY: -
EM Policy
EM Policy
Exclusive interviews with leading policymakers that convey the true policy message that impacts markets.
LATEST FROM EM POLICY: -
G10 Markets
G10 Markets
Real-time insight on key fixed income and fx markets.
Launch MNI PodcastsFixed IncomeFI Markets AnalysisCentral Bank PreviewsFI PiFixed Income Technical AnalysisUS$ Credit Supply PipelineGilt Week AheadGlobal IssuanceEurozoneUKUSDeep DiveGlobal Issuance CalendarsEZ/UK Bond Auction CalendarEZ/UK T-bill Auction CalendarUS Treasury Auction CalendarPolitical RiskMNI Political Risk AnalysisMNI Political Risk - US Daily BriefMNI Political Risk - The week AheadElection Previews -
Emerging Markets
Emerging Markets
Real-time insight of emerging markets in CEMEA, Asia and LatAm region
-
Commodities
-
Credit
Credit
Real time insight of credit markets
-
Data
-
Global Macro
Global Macro
Actionable insight on monetary policy, balance sheet and inflation with focus on global issuance. Analysis on key political risk impacting the global markets.
Global MacroDM Central Bank PreviewsDM Central Bank ReviewsEM Central Bank PreviewsEM Central Bank ReviewsBalance Sheet AnalysisData AnalysisEurozone DataUK DataUS DataAPAC DataInflation InsightEmployment InsightGlobal IssuanceEurozoneUKUSDeep DiveGlobal Issuance Calendars EZ/UK Bond Auction Calendar EZ/UK T-bill Auction Calendar US Treasury Auction Calendar Global Macro Weekly -
About Us
To read the full story
Sign up now for free trial access to this content.
Please enter your details below.
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
Real-time Actionable Insight
Get the latest on Central Bank Policy and FX & FI Markets to help inform both your strategic and tactical decision-making.
Free AccessMNI SOURCES: ECB To Boost PEPP To As Much As EUR2 Trillion
The European Central Bank is likely to expand its EUR1.35 trillion Pandemic Emergency Purchase Programme to as much as EUR2 trillion at its meeting on Dec. 10 but officials are likely to stress that the increase in the PEPP envelope will only be used if necessary, ECB sources told MNI.
With the euro rising above USD1.21, the ECB will also repeat concerns about the currency's strength, they said
The increase in the PEPP's size, by at least EUR400-500 billion, will be matched by an extension in its duration by at least six months to the end of 2021, and perhaps by a whole year to mid-2022, the sources said, adding that it was unlikely that the pace of purchases would increase in the absence of any significant tightening of financial conditions.
But the ECB may say that it will only make use of all of the increase in the PEPP's envelope if necessary, the sources said. The ECB will boost cheap funding for banks via Targeted Longer-Term Refinancing Operations, whose duration might also be adjusted.
PROJECTIONS
Depending on which other measures are approved, the ECB could extend pre-pandemic quantitative easing via its Asset Purchase Programme, but key interest rates, including the TLTRO rate, are likely to remain unchanged. The ECB could adjust collateral requirements for repo operations, as it continues to emphasise that monetary conditions will remain lower for longer.
New macroeconomic forecasts are likely to foresee a weaker fourth quarter than earlier envisaged, but following a better-than-expected third quarter, leaving September's projection for an 8% contraction this year little changed. Next year's growth expectation should be similar to September's estimate of 5%. The inflation outlook, already very weak at 0.3% for 2020 and 1% for 2021, could be marginally worse, and below target throughout the forecast period until 2023.
Nonetheless, there will be upside as well as downside risks next year, with the second half likely to be stronger than earlier anticipated due to the development of effective vaccines. After a difficult first quarter, the second quarter should be mixed, the sources said.
An ECB spokesman declined to comment on the matters in this article.
To read the full story
Sign up now for free trial access to this content.
Please enter your details below.
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.