Experts at Afi talk about the different scenarios of the interest rates that will rule the euro area regarding the characteristics of the ECB’s monetary policy:
– There is a QE in six months. The inflation forecasts increase. The spreads core-periphery slightly reduces.
– There is not a QE in six months. There will be greater fiscal laxity, reforms, weak Euro and cheap oil, which are enough to underpin growth. Slight widening of spreads.
– There is no a QE and the inflation and growth forecasts become entrenched. Strong spreads expansion. Non-sustainable scenario on the medium term. Maybe a belated QE?