FIG hit as ECB takes the safe option

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By Bill Thornhill, Frank Jackman, Lewis McLellan, Mike Turner
10 Dec 2020

The European Central Bank failed to provide the “big bazooka” that some capital market participants were hoping for at its meeting on Thursday. But the central bank did show its willingness to continue financing bank lending until the economy starts to recover, suggesting that FIG supply volumes face another difficult year in 2021.

Central banks are not supposed to provide the market with excitement, so that some bankers described Thursday’s announcement as being rather dreary suggests that the ECB probably hit the right spot.

This was borne out by the fact that, at minus 0.60%, 10 year Bund yields closed largely unchanged on Thursday, ...

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