Handelsbanken does not expect rate cut from ECB

Knut Anton Mork, chief economist Norway for Handelsbanken, has written in a note today that he does not believe the ECB will cut its rates.

The interest rate decision by the ECB, along with that from the Bank of England, are the most important events today, he said.

Besides not cutting rates, however, the ECB is likely to downgrade its growth forecast for next year. Bank president Mario Draghi is expected to repeat the statement that he is ready to buy sovereign bonds from countries that accept the rules that come with the stability fund.

Mork also said he does not expect the Bank of England to cut rates. Neither is further quantitative easing likely to be announced. More QE could yet come, but only if growth prospects drop further and inflation stays around the bank’s target.

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