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ECB to deploy all available tools?

Emily Nicol
Chris Scicluna
  • The ECB’s Governing Council announcement is today’s main event.  Not least given the emergency actions of the Fed and BoE, we expect the ECB to unveil a package of measures. Indeed, it will certainly disappoint markets if it fails to deliver at least a rate and anew lending facility. 

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BoE announces emergency easing package

Emily Nicol
Chris Scicluna
  • In an unscheduled (but not necessary unexpected) announcement, the BoE cut Bank Rate by 50bps to 0.25% and introduced a new Term Funding Scheme to provide incentives for banks to lend to SMEs. This comes ahead of today’s UK Budget, where the government is expected  to confirm plans for significant fiscal stimulus for the first time since the Global Financial Crisis, and probably by the most in almost three decades.

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Manic Monday

Emily Nicol
Chris Scicluna
  • It was another shocking start to the week for financial markets as concerns about coronavirus continued to weigh, with global stocks in free-fall and 10Y Treasury yields rally to a new record low below 0.5%.  With markets pricing in widespread monetary easing from the major central banks, the ECB’s Governing Council decision (Thursday) will be focus. The BoE might also unveil an emergency rate cut following the UK’s Budget statement (Wednesday).

 

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Financial markets in free-fall

Emily Nicol
Chris Scicluna
  • Financial markets remained in risk off mode ahead of a weekend that was likely to bring more bad news on the coronavirus epidemic. The mood in Japan wasn’t helped by some weak domestic spending figures, as well a fall in the Cabinet Office’s leading index to its lowest since the Global Financial Crisis.

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Coronavirus concerns continue to weigh

Emily Nicol
Chris Scicluna
  • While the Fed’s emergency 50bp rate cut yesterday failed to excite investors, the relatively strong performance of Joe Biden in last night’s primaries gave Asian equities a boost. February’s final services PMIs are due from the major economies, along with the US non-manufacturing ISM, but these will reflect increasing concerns associated to the coronavirus to varying degrees.

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