- QE would only come in strict adherence with ECB mandate
- ABS plan neither comparable with QE nor overture
- QE may not work given low sovereign bond yields
- Economic environment complicates policy setting
- ECB cut deposit rate to encourage bank lending
- Economic data are a reason for concern
- Inflation expectations are still anchored
- Preparations for ABS program are still ongoing
- QE would strain risk bearing ability of balance sheet
Yves Mersch has set his bar for QE, if inflation remains low and it falls within their mandate. I expect there to be a German mob with pitchforks and flaming torches outside ECB HQ if we ever get to that point.
