BarroMetrics Views: Europe’s QE?
‘Put up, or shut up’.
In July 2012, Draghi promised ‘to do whatever it takes’ to save the EC and the Euro. To date his ‘interventions’ have been more words than substance. But, at some point significant action must be taken and be seen to be taken- if his credibility is to be maintained.
For Draghi that moment came with his Jackson Hole speech. Yesterday he followed up words with perhaps the first step towards an EC QE: he appointed BlackRock to advise on a QE bond-buy program. As expected, we saw a rally in the DAX and FTse. But the Euro was little moved. I’d have expected to see the EUR move down against the USD, AUD and CAD. Perhaps that will be forthcoming today.