EUR/USD: ECB Meeting 'Largely Market-Neutral' For FX & Rates This Week - SEB

SEB Research discusses the EUR outlook going into the ECB's December policy meeting on Thursday.

Following its recent wide-ranging adjustment of monetary policy on Oct 26, the ECB cannot be expected to announce any further policy changes at its upcoming meeting on Dec 14.

However, we expect the ECB Governing Council to spell out the details of its upcoming QE re-calibration - namely the distribution of the € 30bn QE reduction across the four purchase programs. Mario Draghi will also present new ECB staff projections, including 2020 for the first time. These should reflect higher confidence in the outlook for GDP growth and, to a lesser extent, for inflation. In the press conference, Draghi will once again tread carefully in order to prevent any hawkish market reaction.

We expect the event to be largely market-neutral in rates and in FX space," SEB argues.

Source: Nomura Securities Research

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