The ECB Has More Tools to Ease Further If Necessary

Posted Wednesday, January 29, 2020 by
Skerdian Meta • 1 min read

The Euro has turned quite bearish again this month, with EUR/USD losing around 250 pips from the top. We have seen some green shots from the economic data recently, which the ECB acknowledged, but certain sectors are still in recession. So, they stand ready to ease again if necessary. ECB governing council member, Olli Rehn, made a few comments earlier pointing to further easing, if need be:

  • We have not run out of monetary policy tools
  • If we need to strengthen policy, we still have the tools to do so
  • Current data shows September decision has had positive impact on banks’ profitability

A bit earlier, some economic data from the Eurozone was released and it leaned more on the positive side, but the euro keeps declining nonetheless.

  • German GfK Consumer Climate – 9.9 points against 9.6 expected, prior 9.7 points
  • German December Import Prices – 02% as expected,. down from 0.5% in November
  • M3 Money Supply y/y – 5.0% against 5.5% expected, down from 5.6% previously
  • Private Loans y/y – 3.7% against 3.5% prior and expected
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