Senior Analyst Jens Pedersen at Danske Bank remarked the recent assessment of the ECB’s QE programme by the G20.
Key Quotes
“Currency war or not, the G20 statement following this week's meeting in Istanbul blessed the ECB QE programme and noted that differences in economic conditions make divergent monetary policy necessary”.
“Indeed, we believe notably the Fed and BoE will stay relatively complacent regarding the strength of their currencies vis-à-vis the EUR and that both will invoke on policy normalisation later this year”.
“That said, the G20 also said that ‘In an environment of diverging monetary policy settings and rising financial market volatility, policy settings should be carefully calibrated and clearly communicated to minimise negative spillovers’”.
“Or put differently: central bankers, please do not deliver unnecessary volatility - e.g. by a sudden change in policy regime such as the one from the SNB last month”.
Key Quotes
“Currency war or not, the G20 statement following this week's meeting in Istanbul blessed the ECB QE programme and noted that differences in economic conditions make divergent monetary policy necessary”.
“Indeed, we believe notably the Fed and BoE will stay relatively complacent regarding the strength of their currencies vis-à-vis the EUR and that both will invoke on policy normalisation later this year”.
“That said, the G20 also said that ‘In an environment of diverging monetary policy settings and rising financial market volatility, policy settings should be carefully calibrated and clearly communicated to minimise negative spillovers’”.
“Or put differently: central bankers, please do not deliver unnecessary volatility - e.g. by a sudden change in policy regime such as the one from the SNB last month”.
