HALISTER1: EUR Unlikely to Benefit From Any Post-ECB EGB Yield Rise: BNP

EUR Unlikely to Benefit From Any Post-ECB EGB Yield Rise: BNP

(Bloomberg) -- Long-end core EGB yields could rise even if ECB delivers more easing measures this week; still, EUR unlikely to benefit meaningfully with front-end rates seen anchored, BNP Paribas strategists write in client note.
  • See evolving U.S. rate trends as the main driver for EUR/USD moves this week
  • BNP Paribas economists expect ECB to announce an extension of its QE program beyond its March 2017 expiration at this week’s meeting, along with changes to the rules governing its purchase of government bonds
    • Changes could include increasing the issue-share limit, removing deposit-rate floor, moving away from capital key-based allocation of purchases
  • Expect Fed speakers to be “out in force in the week ahead,” guiding markets toward a September rate move after erratic price action following last week’s August employment report
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

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2539Z GR (European Central Bank)

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