ECB: Strong Eurozone growth is likely to be the focus - ING

Strong eurozone growth is likely to be the focus of the ECB, with survey indicators suggesting that the recovery will continue into 2018, albeit at a somewhat slower pace than the first half of 2017, according to analysts at ING.

Key Quotes

“Since early summer, the ECB has been struggling with the right game plan. The risk of deflation has disappeared, the economy is going well, inflation remains too low (partly due to structural reasons) and the issue of bond scarcity will become more pressing next year. Finding the right narrative and timing for tapering has been a challenge. The big issue at this week's meeting will be the stronger euro and its possible impact on the ECB's wider game plan for tapering, which to date has been complicated by the strengthening euro, and staff projections.”

“With the stronger euro, the ECB is likely to be more cautious with its tapering communication. In fact, there are two options: either announce the details of a very dovish tapering starting January 2018, this week, hoping that full clarity restores calm, or strike a cautious balance between giving the first hint at upcoming tapering and adopting dovish tones.”