Euro-zone QE largely positive for UK

Anything that kick-starts the UK’s biggest trading partner clearly has the potential to be good news this side of the Channel too. That said, the main channel through which we think QE will work in the euro-zone is by pushing down the euro, which could mitigate its benefits to UK exporters.

Accordingly, euro-zone QE is unlikely to be a game-changer for the UK, although it should at least lower the risk that a deflationary slump in the euro-zone brings the UK’s recovery to an abrupt halt.