ECB: Change in policy is unlikely before December - Rabobank

Research Team at Rabobank, suggests that although ECB policy remained on hold in September, Draghi did strike a dovish tone whilst finally also acknowledging that the ECB is facing a shortage of supply for its QE programme.

Key Quotes

“The Council therefore sent colleagues home with a homework assignment: it tasked the relevant committees “to evaluate the options that ensure a smooth implementation of our purchase program.”

The Council also tacitly admitted that the purchase programme may have to be extended beyond its current official end date.

The main question is thus whether the Council is evaluating its options in order to allow for an extension, or because it is facing immediate supply constraints. We believe that the former is the case, which to us suggests that a change in ECB policy is unlikely before December.

Comments by the Latvian central bank’s Rimsevics, suggesting that the homework assignment is not due until December, support this view.”