Policy games - Interest and exchange rate forecast

Policy games - Interest and exchange rate forecast

Compared to their Japanese counterpart, European central bankers looked decidedly timid as they left monetary policy setting unchanged in April.

Economic Analysis

08 April 2013

While the Bank of Japan is hoping to end nearly two decades of deflation with a large increase in its asset purchase programme, the European Central Bank is dithering over a quarter-point cut to its key interest rate. With unemployment at an all time high and confidence weakening again, we expect a cut to 0.5% in Q2.

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