MBS Day Ahead: Markets Look to Draghi to Clarify ECB Tapering Announcement

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Posted To: MBS Commentary

The European Central Bank (ECB) changed things up today, to some extent. Unlike the Fed, which always unveils its big policy changes in the "announcement" itself, the ECB historically tends to address interest rate changes in the announcement and save QE-related adjustments for the press conference. This practice was so well established that I even sent out a previous "Day Ahead" to MBS Live subscribers talking about how we'd be waiting until the 8:30am press conference to find out the important stuff. Turns out the joke's on me (and the rest of the world, for that matter) as the ECB flipped the script and made the tapering announcement in the 7:45am release. Markets have taken it quite well so far, which isn't too surprising considering the extent to which some…(read more)

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