All indications are that the ECB will keep unchanged its interest rates – Investing.com Spain

Investing.com – The European Central Bank (ECB) has started on Wednesday its policy meeting two days, and investors are awaiting whether the chairman of the monetary authority eurozone, Mario Draghi, will announce an extension of the purchase program bonds

Although it is not expected that the announcement Thursday at 7:45, when the east coast (13.: 45 in Spain) include any change in interest rates, which currently stand at 0%, or the deposit facility rate, which is anchored at -0.4%, market players await attention news conference that offered Draghi only 45 minutes later.

inflation in the euro zone is well below the target rate of the ECB set at 2%, so experts are convinced that Draghi will have to expand the asset purchase program beyond its current end date in March 2017 and above the target of 1.7 billion EUR. The ECB currently buys EUR 80.000 million per month.

However, experts are divided as to whether Draghi will make the official announcement on Thursday. A recent Bloomberg survey indicated that more than 80% of economists expect to take action this year, but less than half expect to take place this Thursday. The rest expected that the announcement will come at the meeting in October or December.

Although analysts do not believe that there will be more moves in monetary policy, most expect Draghi to maintain a cautious stance and offer indications of future easing measures.

Maybe the ECB need to lift restrictions on bond purchases

Several experts have indicated that the main problem when implementing measures by the ECB is a shortage of assets to acquire.

Analysts Nordea have said the ECB could run out of eligible Eurobonds to buy at the end of the year unless you reduce your own restrictions.

the main problem is the fact that the ECB has imposed a limit on assets that can be purchased with the deposit rate at -0.4%, but TD Securities estimated that 28% of bonds of the euro zone and 66% of German bonds have a lower than this level performance.

“Even in the case of Finland, at this level of performance, the ECB is likely to continue buying other five or six months, “said Societe Generale (PA in a note.

” Another drop in performance, however, could reduce the horizon, therefore, the ECB would prefer to be preventive ” warned analysts.

Among the options responsible for monetary policy is eliminating the limit of the deposit rate in order to expand the number of available bonds.

Another possibility is that the ECB will remove the self-imposed ceiling not buy more than 33% of any bonus.

Although considered an unlikely step at this time, the ECB may also withdraw its main rule on capital , which sets the amount of purchases of each country according to the size of its economy

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