There is a 50 percent chance that the European Central Bank (ECB) will start to buy government bonds in the first quarter of 2015, according to Goldman Sachs’ top strategists.
“The emphasis that Draghi put on the urgency of expanding the balance sheet makes us think that government securities will be the asset of choice to pursue that objective, that’s why we have that forecast right now,” Francesco Garzarelli, co-head of global macro and markets research at Goldman Sachs, told CNBC on Thursday.
Unlike central banks in the U.K., U.S. and elsewhere, the ECB has not yet launched a sovereign bond-buying – or quantitative easing (QE) – program.
“The market is going from theme to theme and now the theme is the ECB. And there is an idea that the baton in this QE relay has been passed to the ECB, hence the government bond purchase discussion,” Garzarelli added.
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