ECB desires higher bond yields, IMF forecasts are a mess – Shaun Richards

European equities are down today primarily due to ECB’s QE taper talk, although the market reaction appears premature given the Bloomberg article which revealed ECB’s intentions merely said the bank would end the QE program in a phased manner if and when it decides to do so.

Nevertheless, the timing of the QE taper talk forces us to question whether the central bank is following suit to Bank of Japan (BOJ).

Shaun Richards from Not A Yes Man Economics says that the ECB now intends to have higher yields after having pushed them into negative territory. This would not only help restore bank profitability but also address the problem of shortage of bonds eligible for QE program.

Richards also talks about the International Monetary Fund (IMF), whose forecasts have turned unreliable off late, given that it lags markets big time. The most notable U-turn by the IMF is that it sees UK as the fastest growing DM as opposed to the earlier forecast which said UK would suffer due to Brexit.

Viewers would get a clear picture of where the central banks and markets are heading after watching this segment. Richards is joined by Tip TV’s Zak Mir and Mike Ingram, Strategist at BGC Partners.