Report
The successive stages of the ECB’s "emancipation"
Over time, the ECB has gradually "emancipated" itself from the strict rules that normally govern a central bank’s actions. Initially, it only controlled short-term interest rates; In March 2015, the ECB started buying public sector bonds, and therefore also started controlling long-term interest rates on government bonds, which is clearly a monetisation operation; In June 2016, the ECB started buying Investment Grade corporate bonds, and therefore also gained an influence on credit spreads while creating distortions between asset prices. What more could the ECB do if the euro zone was in trouble and if deflationary trends were to reappear? It could emancipate itself even more from "rigour", from orthodoxy by: Buying risky assets: High Yield bonds, bank bonds, or equities; Switching to helicopter money: distribution of money to economic agents without consideration.
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Natixis
Based across the world’s leading financial centers, Natixis CIB Research offers an integrated view of the markets. The team provides support to inform Natixis clients’ investment and hedging decisions across all asset classes.
Patrick Artus
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