Tag Archive: ECB staff projections

Albert Edwards: Investors Should Brace For A World Of Negative Rates, 15percent Budget Deficits And Helicopter Money

2019-02-08

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2019-02-08

Modern Money Theory, Jan 2004 - 2019
Eariler this week, when the San Fran Fed published a paper that suggested that the recovery would have been stronger if only the Fed had cut rates to negative, we proposed that this is nothing more than a trial balloon for the next recession/depression, one in which the Federal Reserve will seek affirmative "empirical evidence" that greenlights this unprecedented NIRPy step (in addition to QE of course).

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ECB policy: Stop Worrying and Love the Soft Patch

2018-04-21

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2018-04-21

For all the talk about weaker economic momentum and low inflation in the euro area, we would not jump to conclusions in terms of ECB policy. True, downside risks have re-emerged over the past couple of months, generating understandable concerns and frustration in Frankfurt. However, the ECB is unlikely to respond unless those risks materialise, which is not our central case.

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Upside risks to wages from IG Metall negotiations

2018-01-21

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2018-01-21

Euro area and German Wage Growth, 1999 - 2018
German wage negotiations are in full swing amid growing calls for strikes. This comes at a crucial time for the ECB as strong growth and falling unemployment are expected to feed into higher inflation. IG Metall is by far the most important union to watch, representing almost 4 million German workers and being seen as a benchmark, including in the car industry or the construction sector this year.

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ECB closer to the 2% inflation target than meets the eye

2017-12-21

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2017-12-21

During an uneventful ECB press conference on Thursday, attention centred on the new staff projections. The headline projections were in line with expectations, albeit slightly higher on GDP growth and lower on inflation. The key word was “confidence” - in a strong expansion leading to a “significant” reduction in economic slack, as well as in the ECB’s capacity to meet its mandate.

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