European Central Bank meet Thursday 29 October 2020 - preview
ECB decision due at 1145GMT on Thursday
I posted a preview yesterday:
Adam posted this also:
JP Morgan preview comments (bolding mine):
With COVID- 19 infections rising sharply ... ECB meeting has become much more interesting. This is not because much is expected in terms of actual decisions. In fact, we still think that there is only a chance of some changes to TLTRO-III modalities and tiering multiples. Instead, the meeting will give the ECB an opportunity to take stock of the recent data and COVID-I9 news, and possibly offer some guidance about the December meeting when new staff forecasts will be available.
- We continue to think that the ECB will in December announce an expansion of PEPP by another E500bn, and that it will have to follow this up in mid-2021 with another increase of E250bn.
- First, 3Q20 GDP estimates will be published one day after next week's meeting and will be important for assessing the extent of the recovery ahead of thc acceleration in new infections.
- Second, the next few weeks will show if current containment measures are working and if more is needed. The news on governments' responses is moving very quickly.
- Third, the outcome of the US election and Brexit negotiations will also matter ahead of the ECB's meeting in December.
- Fourth, the ECB still has a lot of spare capacity within the current PEPP envelope, with purchases lasting until mid-2021 at the current pace, and it still has further TLTRO-Ills lined up.