ECB Draghi in Focus as German Confidence Drops

The president of the European Central Bank (ECB), Mario Draghi, is expected to conjure his powers of allusion on Thursday with uncertainty over Brexit still looming large on the horizon.

“Resilient markets post-Brexit allow the ECB to only hint at new stimulus, which we expect in September,” analysts at Bank of America Merrill Lynch said in a note Tuesday while referencing Monty Python’s famous “nudge, nudge, wink, wink” sketch.

The Italian economist – well known for tough “whatever it takes” promises – will be up in front of the cameras following the ECB’s rate decision Thursday where the bank is widely expected to hold off on any new announcements or rate cuts.

The Frankfurt-based institution is already pumping 80 billion euros ($88 billion) a month into the fragile euro zone economy and a lack of fresh data means it will likely hold off on any further moves following the U.K. referendum. Economists are expecting a hit to global growth due to Brexit and euro zone economies are expected to be particularly vulnerable. There’s the added complication that the vote will also add weight to anti-EU sentiment across the region.

via CNBC

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza