There are still divergences between the monetary policies of the Fed and the ECB. But if Draghi meets expectations for progressive withdrawal of the stimuli from September and rate hikes in the first few months of 2018, a new “currencies war” is not on the cards in the near future.
ECB interest rates rise
The surprisingly low annual eurozone inflation reading for March at 1.5% will finally end speculation about an earlier end to the negative deposit rate in today’s ECB’s governing council meeting, as reported by Julius Bär’s experts. Both ECB Chief Economist Peter Praet and ECB President Mario Draghi have already made clear in recent weeks that interest rates will not rise before the ECB’s asset-purchasing programme comes to an end.