HALISTER1: EUR 5y5y HICPxT Inflation Risks Skewed Toward Downside: Citi

EUR 5y5y HICPxT Inflation Risks Skewed Toward Downside: Citi

(Bloomberg) -- EUR 5y5y HICPxT struggles to finds enough impetus to rally with the risk firmly skewed to the downside, Citigroup strategists, including Jamie Searle, write in a client note.
  • Would not be surprising to see it drift down toward 1.2%
  • Market’s reluctance to allow 5y5y HICPxT to correct higher suggests that it wants more
  • Draghi increasingly has to answer questions about ‘helicopter money’ with the market seemingly already hungry for the next game changer
  • Problem is that ‘helicopter money’ seems a very distant, politically and technically difficult, and consequently, still improbable prospect
  • At the very least, it would probably require a major global growth recession
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

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Jamie Searle (Citigroup Inc)

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