- It’s important to show what we have in the way of instruments which are flexible
- ECB will discuss if new LTRO is needed
- No additional liquidity needed at the moment
Recap: Rate hikes may only have effect post non-standard exit.
LTRO’s continue to come up in the headlines and the whole point of them was to provide liquidity to the banks while they sorted themselves out. If they need another round of € injections then that would suggest liquidity isn’t really the main issue but that some banks are still up shit creek. Twinned with his comment of rate rises not accounting for much until such measures and policies are finished, the Euro is wiping some of it’s rate rise expectations off the table.
