Draghi to shrug off currency concerns

The continued improvement in financial market conditions and surveys of economic activity has taken some of the pressure off the ECB this month. We expect the Bank to strike a relatively hawkish tone after its forthcoming meeting, stating that no further policies are needed at present and that existing support from LTROs can be allowed to unwind. But the Bank’s faith that improving financial market conditions will soon generate economic growth might prove to be mis-placed. And with other central banks still upping their support, the ECB risks losing out in a currency war