European Central Bank: No Ultra-Easy Policy Exit
Eurozone borrowing costs have declined. European Central Bank isn’t so sure now about exiting an ultra-easy monetary policy. Recently improved euro and government bond yields might be the cause of this. Members will discuss the case at their next meeting July 20. Rainer Guntermann (rates strategist at Commerzbank) said that soon ECB will have to sit and think carefully about the asset-purchase program lowering. At this point, government bond yields dropped 2-4 bps, despite reaching maximums earlier. German 10-year Bund yields reduced to 0.45%.
Nick Gartside (International CIO of fixed income at JP Morgan Asset Management) noted that considering the fact that the global economy is recovering, Central Banks should no longer keep loose policy stance.