ECB review & potential shock from credit spreads – ADMISI

What did ECB exactly do on Thursday…is the question faced by traders/investors across the globe.

Was there a QE Taper or extension of QE or both?

In this segment, Marc Ostwald, Strategist at ADM Investor Services International (ADMISI) weighs-on on the ECB decision and concludes the ECB’s move on Thursday indicates there is a policy implementation problem… the likes of which we have never seen before!

Ostwald also talks about the euphoric markets ignoring/being remarkably resilient to sharp rise in the yields. However, he warns the first signs of stress are likely to be seen in the credit markets.

“There will be a shock when the credit spreads start widening in response to the rise in the government bond yields”, says Ostwald.

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