Minutes from last ECB meeting now published
- Eurozone recovery moderate and fragile
- risks to inflation forecasts to the downside
- some rate setters suggested bigger monthly asset purchases or frontloading, extending beyond 6 months
- few rate setters suggested a bigger depo rate cut
- those that argued against further measures called for more time to see how current measures pan out
- 10 bps rate cut in Dec left room for further reduction if necessary, not seen triggering material negative side effects
- downward drift in inflation expectations could be difficult to reverse
- ECB reminded govts "forcefully" that reform is needed. ECB can't solve growth problem on its own
- bulk of asset purchases have been from non-residents suggesting that the impact on money creation in EZ was muted
Essentially the Minutes are a rehash of the statement/comments from Draghi in the presser at last meeting.
EURUSD is trading a little lower again with the Minutes not necessarily backing up the earlier more bullish comments reported by Reuters in their discussions with certain gov council members.
ECB clearly erring on the side of caution in both growth and inflation forecasts.
Full Minutes here
