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Edition November 10, 2015 - Crédit Agricole S.A.
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  • Edition November 10, 2015

    Eurozone - QE impact indicator - November 2015 : Flash in the pan?

    Our Quantitative Easing impact indicator continued to edge down in October, following the virtually across-the-board deterioration in monetary and financial conditions observed over the summer. The monetary policy transmission channels that most immediately responded to the launch of the policy at the start of the year are those that have deteriorated most.

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  • Content:

    - Flash in the pan?
    - Interest-rate channel
    - Lending channel
    - Exchange rate channel
    - Expectations channel
    - Asset price channel
    - Appendix: Method
    - Components of the indicator

  • Extract – The traditional credit channel reactivates

    Inflation expectations, following their rapid increase in the wake of the announcement, are now back where they were in late 2014, prior to the programme's announcement. Renewed upward pressure on the euro persisted throughout the autumn and only the ECB's recent intervention (on 22 October), pointing to an expansion of QE and a cut in the deposit rate, held things back. Yields on core country sovereign paper have begun falling again and risk premia are continuing to shrink. But risk premia in the corporate sector have risen, signalling an indiscriminate rise in risk aversion. The traditional monetary policy transmission channel of lending is getting underway slowly but surely, even if it is struggling to gain full traction. The banking sector is signalling growing use of liquidity to finance lending, especially to businesses and consumers.

  • QE Impact Index - ECB Targets

    The ECB's Quantitiative Easing policy has managed to revive confidence and has contributed to reinvigorate activity. Output growth remains nonetheless weak, and the deflationary fears it had initially managed to keep away are back.

    QE Impact Index - ECB Targets
  • Associative topics : Economics | Europe


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