ECB Action in December? Don’t Count on It: Posen

The European Central Bank (ECB) will not to boost monetary stimulus further before the U.S. Federal Reserve hikes interest rates, Adam Posen, President of the Peterson Institute for International Economics, told CNBC Tuesday.

Market watchers broadly believe the Fed will hike rates in December, while the ECB hinted in October that it could announce more stimulus measures in December.

But Posen said the Fed had already “done part of the job” for the ECB by lowering the euro-dollar exchange rate, acting as a further stimulus for Europe as a weaker currency boosts exports.

He believed the ECB would wait until 2016 before it committed to further easing. That could include a cut to the already negative deposit rate, the rate the ECB charges banks to park money with it, as well as an expansion of its existing 1 trillion euro ($1.1 trillion) asset purchase program.


Craig Erlam
Based in London, England, Craig Erlam joined OANDA in 2015 as a Market Analyst. With more than five years' experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while conducting macroeconomic commentary. He has been published by The Financial Times, Reuters, the BBC and The Telegraph, and he also appears regularly as a guest commentator on Bloomberg TV, CNBC, FOX Business and BNN. Craig holds a full membership to the Society of Technical Analysts and he is recognized as a Certified Financial Technician by the International Federation of Technical Analysts.