BBH: the ECB meeting this week, there are three ways to expand the asset purchase

Updated: October 20, 2015  Views: 61
BBH: ECB are three ways to expand asset purchases this week

Remittance Network October 19 hearing - the bank Brown Brothers Harriman (BBH) research team on Monday (October 19) said this week the European Central Bank [microblogging] meeting, there are three ways to increase the asset purchase, or the European Central Bank may be a further reduction of 0.2% has a negative deposit rate.

The agency noted the increase in the asset purchase of the following three ways:

1. May announced the extension of the current asset purchase program, which is tentatively scheduled for the current deadline in September 2016. This is probably one case investors most want to see. At present, some people talk about the asset purchase extended 6 months.

2. Possible asset purchases announced increased. There is a logic is that if the increase in asset purchases, perhaps you can not extend the duration of the asset-purchase program. Extend planned duration time means more long-term commitment, but not necessarily more effective.

3. Possible adjustment of assets constitute asset purchases. To purchase asset-backed is not particularly successful. More radical plan might include bank bonds or corporate bonds.

The ECB has to be further reduced to 0.2% negative interest rates on deposits. Given the current rate of return is lower than a predetermined prohibited from buying government bonds, deposit rates, which will increase the assets available to the European Central Bank to buy. Lower Negative Deposit interest rates may also have a more direct impact on the euro, the appreciation of the trade-weighted euro exchange rate and low inflation for the ECB / deflation fight negative. It may also be those who want to expand the QE and those suspected from the outset QE effect A compromise between people.

22:05 GMT, the euro against the US dollar reported 1.1321 / 23.


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