The ecb, with a possible extension of the Qe – Il Sole 24 Ore

frankfurt am main

Appointment in December. The president of the european central Bank, Mario Draghi, has entered yesterday in the press conference firmly decided not to take any commitment on the future action of the Ecb, nor to reveal the possible details, but explained that “the decisions of December will define the framework for the next few months”. Draghi has also repeated that he confirmed “the need to preserve the amount very substantial support monetary it is necessary to ensure the return of inflation towards levels below, but close to, 2% without unjustified delay”.

Even if he has not promised to extend the program of purchase of bonds, Qe, beyond march next, and on the contrary, he said explicitly that the lengthening has not been discussed, Draghi has hinted that this may happen at the next meeting of the council on the 8th of December, and that then will also explain how the Ecb intends to address the shortages of certain securities to buy (especially German Bunds), which may occur in the event of a lengthening of the program. These are options which the council, after an exhibition by the technical committees, has dedicated a large part of the discussion yesterday, as revealed in Dragons. For the moment, you appeared so determined to avoid entering into the merits of future actions that the press conference was closed with a quarter of an hour earlier than 60 minutes regular.

the central banker of italy has instead denied so decided (“sources not informed”), are the rumors that circulated in recent weeks that the Ecb is preparing a gradual reduction (“tapering”) of the volume of purchases, today’s 80-billion-euro per month. Of course, he admitted, the Qe is not forever and “no one thinks” that is closed in an abrupt way, but the theme is not current.

inflation, in fact, if it is ascent in September, at 0.4%, it remains far from the goal of getting closer to 2%, and the mini-bounce has been due primarily to the increase in energy prices. The inflation of the base, purified in the price of oil, has kept to emphasize to the Dragons, “no signs of a convincing upward trend”. And this for months. The macroeconomic framework is being developed according to the forecasts of the Ecb, “moderate growth and stable, gradual rise of inflation, but with risks to the downside, especially from the external environment” in the eurozone. For this reason, the council prefers to give a further six weeks: not only the technical committees have completed their work (“it is the council that has the last

word,” he insisted Dragons), but will be available in the macro-economic projections up to date, which will include, for the first time in 2019. At recent meetings of the monetary Fund in Washington, had said (but h e repeated it yesterday) to expect that inflation will approach the target towards the end of 2018 and start of 2019. By the new estimates in December, will seek a confirmation: in the meantime, will have to build a consensus in the face of German opposition. But the head of the Ecb has underlined once again that the forecasts are however based on financial conditions accommodative, and these, in their turn, depend on the “extraordinary” degree of monetary stimulus in place and the expectations of its continuation. He also noted that the board will want to see a convergence “sustained” inflation towards the target and will ignore the individual monthly data that are anomalous. All the more reason to believe that after march, the Ecb will insist with the Qe, as we expect the markets.

The periphery of the eurozone remain under the constant attention of Frankfurt. Today, the canadian Dbrs will announce its decision on the rating of Portugal, is the only one that still assigns to Lisbon a level of "investment grade" (BBB-). Without it, he has confirmed to the Dragons, the titles of Portuguese would be excluded from Qe and may no longer be used as collateral for the refinancing of the banks at the Ecb itself. Draghi has, however, recalled that at the time the outlook of the ratings of Dbrs are stable and praised the action of the Government, even if they are the vulnerability of the debt of the enterprises and doubtful. As to Greece, it is premature to talk of inclusion of their securities in the Qe: the Ecb will, in due time, its debt sustainability analysis, on which it has “concerns”.

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