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15 Apr 2015
Key points from Draghi’s speech – BBH
FXStreet (Barcelona) - Mark Chandler, Global Head of Currency Strategy at Brown Brothers Harriman, highlights the key points from Draghi’s speech today, further noting that although Draghi didn’t make any surprising references, he did confirm continued support to Greek banks.
Key Quotes
“There were not high hopes for new action from the ECB and they were not disappointed. Policy was left as it is with a negative 20 bp deposit behavior. The weaker than expected April US Empire manufacturing survey (-1.19 vs 6.90 in March) helped break the euro's downside momentum.”
“Draghi made four points, none of which are surprising:
The cyclical recovery in the euro area has strengthened.
The asset purchase program has been successful
It will continue until September 2016 at least or a sustained increase in inflation. The program is flexible.
The ECB is not experiencing operational difficulties in conducting the asset purchases. Concerns about bond scarcity is "premature."
“In response to a question, Draghi noted that the ECB has continued to support Greek banks through ELA, which it is wiling to do provided the banks are solvent and they have collateral. The ECB's exposure is 110 bln euros, which is most relative to the country's GDP.“
Key Quotes
“There were not high hopes for new action from the ECB and they were not disappointed. Policy was left as it is with a negative 20 bp deposit behavior. The weaker than expected April US Empire manufacturing survey (-1.19 vs 6.90 in March) helped break the euro's downside momentum.”
“Draghi made four points, none of which are surprising:
The cyclical recovery in the euro area has strengthened.
The asset purchase program has been successful
It will continue until September 2016 at least or a sustained increase in inflation. The program is flexible.
The ECB is not experiencing operational difficulties in conducting the asset purchases. Concerns about bond scarcity is "premature."
“In response to a question, Draghi noted that the ECB has continued to support Greek banks through ELA, which it is wiling to do provided the banks are solvent and they have collateral. The ECB's exposure is 110 bln euros, which is most relative to the country's GDP.“