Filippo Alloatti of Federated Hermes believes that the European Central Bank (ECB) will maintain its accommodative monetary policy in the near term. He cites the ongoing economic uncertainty caused by the COVID-19 pandemic as well as the ECB’s commitment to keeping inflation below 2%. However, he also notes that the ECB may start to taper its asset purchases in the second half of the year if the economic recovery continues.
Alloatti also discusses the potential for the ECB to raise interest rates in the future. He says that the ECB is likely to keep rates on hold until inflation is consistently above 2%. However, he notes that the ECB could raise rates sooner if inflation continues to rise or if the economic recovery is stronger than expected.
Overall, Alloatti believes that the ECB will maintain its accommodative monetary policy in the near term. However, he also notes that the ECB could start to taper its asset purchases and raise interest rates in the future if the economic recovery continues.
In addition to the factors mentioned above, Alloatti also discusses the following:
* The impact of the COVID-19 pandemic on the Eurozone economy
* The ECB’s response to the pandemic
* The outlook for inflation in the Eurozone
* The potential for the ECB to raise interest rates in the future
