Cassa Lombarda: Draghi support for risk assets – WORD TO THE MARKET – BBC

18:41 Marco Vailati * (Il Sole 24 Ore Thomson Financial) – Milan, Jan. 21 – In today’s meeting, the ECB left unchanged the monetary policy measures in place as expected: – deposit rate to -0.30% – refinancing rate at 00:05 +% – purchase assets for 60 billion per month at least until marzo’17 and reinvestment of what ‘expires. In introductory statements at the press conference and in the next session of questions / answers Draghi made clear the following concepts: -the measures implemented by the ECB are having a positive impact by improving the credit environment in the eurozone -however remain and have even increased the downside risks for the slowdown in emerging (but that of China and ‘in line with estimates for now ECB), geopolitical risks, the volatility’ of the financial markets, the slow pace of structural reforms and the need ‘to fiscal adjustments in various sectors. Banks, about the tensions of recent days, however, that non-performing loans are already ‘been considered nell’AQR and that the questionnaire sent and’ survey on the management of non-performing loans in order to disseminate “best practices” and not to increase provisions. He also added that Italian banks have provisions in line with European averages and also guarantees. Comment The downside risks so require a revision of the scenario and a reconsideration of the interventions at the next meeting on 10 March, when they will be available to the new macroeconomic projections of the management of the ECB extended to 2018. In fact, inflation in December (0.2%) and ‘already’ it was lower than expected because of oil prices (fell by 40% from the previous meeting), but also to lower increases in the prices of food and services (so ‘called “second round effects” that the ECB closely monitors) and is expected to remain low throughout 2016 with these oil prices, while the goal of the ECB and ‘bring it back close to 2% and have the power, the determination and the means to do so, while the change is not’ a formal objective also if it is observed to the extent that affects inflation. With a rhetoric determined Dragons tried to influence again the markets anticipating that in March new expansionary measures of monetary policy will very likely. E ‘remained vague about the nature and extent’ of such interventions, but wanted to give a warning to markets emphasizing the determination and strength available to the ECB to achieve its inflation target. Cosi ‘after the “what ever it takes!” 2011 we had today the expression “we do not give up!” The impact of the conference and ‘support for risk assets and negative for the Euro. * Head of Research and Investment of Cassa Lombarda “The news content and information transmitted under the title” Word to the market “can not in any circumstances be considered a solicitation or promotion of any form of investment it ‘customized recommendations to any form of financing. The analysis contained in the information received in the specific section are drawn from the society ‘to which the subject specifically listed as author. The news agency Il Sole 24 Ore Thomson disclaims all responsibility’ as to the veracity ‘, accuracy and completeness of the analysis and therefore invites users to take note with care and due diligence of the above stated and represented by the company ”. (RADIOCOR) 01/21/16 18:41:56 (0641) 5