As the clock ticks down to the eagerly awaited announcements are we likely to have learnt much more by this afternoon?
The Old Lady has a new young man to take her dancing but I think any change in policy is unlikely today. Yes Gorgeous George Miracle Man Mark is widely touted to want to continue in his dovish ways this side of the pond, but surely even with his diplomatic charm he will be not looking to turn his colleagues on a first date.
There’s talk of a possible statement afterwards in a break with BOE tradition, which might enable him to express an emphasis/opinion on forward guidance, but with recent data proving positive will he be wanting to sound too eager first off the ramp, even if his ego wants differently?
The jury is out on whether the current level of QE ( GBP 375 bln and on hold since 2012) and other forms of easing have had any real effect, so Mr C will be looking at where further action can make the best impact.
The market is priced for no-change today but has one finger firmly hovering over both the sell and buy buttons. It is that finely poised. Captain Fantastic has left many swooning that the miracle cure has been found, even if it won’t yet be revealed. I’m still yet to be convinced.
And what of the ECB? Much talk of there being pressure on Mr Draghi to give more forward guidance, even suggest the use of the more LTROs in his press conference today. It’s certainly unlikely that they will cut rates, keeping their powder dry for later in the year when the more upbeat Q3/4 forecasts turn out to be somewhat disappointing. Some kind of reference to deposit rates can’t be ruled out either.
His views on impending US tapering will undoubtedly crop up in the press conference and we can expect/hope that the assembled journalists will give him a torrid time, giving us some further clues on future policy. Draghi does try and keep his cards close to his chest but has been known to drop the odd bombshell, deliberately or otherwise. Let’s hope today is one of those days.
What say you all ?