Commenting on today’s monetary policy announcements from the European Central Bank (ECB), Yael Selfin, head of macroeconomics at KPMG in the UK, said:
“The ECB’s latest forecasts suggest the UK’s decision to leave the EU is likely to have a relatively minor impact on the Eurozone economy over the next two years. The ECB’s assessment of the outlook for the Eurozone economy was revised downwards very marginally with the risks more skewed to the downside, only in part due the uncertainties arising as a result of the Brexit vote.
“As a result, the ECB has opted to keep its monetary stance unchanged in September, without announcing any concrete steps to expand its quantitative easing programme beyond the first quarter of 2017 when the current programme is due to expire, or any measures to widen its current QE scope.
“Given ECB’s limited room for manoeuvre, Mario Draghi’s continued call to accelerate structural reforms across the Eurozone remain extremely pertinent. However, given there are a number of key parliamentary elections on the horizon in the EU, it is unlikely that any major progress will be made, making it harder for the Eurozone economy to lift its performance in the near term.”
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