ECB has to keep cooking – Rabobank

By FXStreet Analysts at Rabobank explained that the ECB will continue its efforts to bring growth and inflation back on track.

Key Quotes:

“Moreover, when we think about the various risks that the Eurozone are facing, a ‘Brexit’ could typically be a scenario which would give the ECB a good excuse to abandon the capital key restriction.

A UK exit from the EU would likely raise speculation of more countries following the UK’s example and push sovereign spreads higher.

In recent months we’ve also come across a list of policy measures that verges on the absurd/unthinkable.

This (tongue in cheek) ranges from the ECB buying oil (we cannot see how this works when the oil is stored), taking large chuncks of risky assets from bank’s balance sheets (but it’s regulating the industry) to helicopter money (which people then use to deleverage) to ECB cash for clunckers coupled with a Green Agenda (ECB going ‘electric’ rather than ‘nuclear’).

One thing is sure, though, as long as the structural problems are not solved, the ECB has no option but to keep ‘cooking’.”
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Source:: FX Street