European Economics

ECB to announce taper despite Italy fears

ECB Watch
Written by Capital Economics Economist

Despite worries about Italy’s new Government, we suspect that the ECB will announce after its meeting on 14th June that it will end its asset purchases this year. It might also strengthen its guidance on interest rates to prevent speculation that it will begin tightening early in 2019. Finally, President Draghi may warn Italy’s new government that ECB support will not come without conditions.