Business Irish

Monday 16 January 2017

Traders betting ECB will cut rates deeper

Shrutee Sarkar

Published 08/03/2016 | 02:30

European Central Bank President Mario Draghi will expand asset purchases on Thursday, according to a Reuters poll of traders. Photo: Yves Herman/Reuters
European Central Bank President Mario Draghi will expand asset purchases on Thursday, according to a Reuters poll of traders. Photo: Yves Herman/Reuters

The European Central Bank will expand the size of its monthly asset purchases on Thursday, according to a Reuters poll of traders, who expect another cut to the already negative deposit rate.

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With pressure building on the ECB to ease policy further, euro money market traders polled gave a median 68pc chance the central bank increases its current €60bn of monthly asset purchases.

That is higher than the 50-50 chance they gave just last week. Traders also said the ECB would cut its deposit rate by 10 basis points to -0.4pc. The regular poll of 21 traders showed banks would borrow €60bn at the weekly tender, just a tad lower than the €61.3bn maturing from last week. Meanwhile, sentiment in the Eurozone has deteriorated so far in March for the third month running.

Sentiment has hit the lowest level in more than a year, a Sentix survey showed yesterday, as investors worried about weaker growth prospects for the world economy. (Reuters)

Irish Independent

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