Economic Research: Andres Lipstok

Thursday, 3 January 2013

Andres Lipstok

ECB council member Andres Lipstok today said that the ECB is not planning more stimulus at the moment despite the increased concern about Greece leaving the Eurozone. He said "we didn't discuss cutting rates below 1% in our meetings." His comments were in line with recent comments by other Eurozone members but nevertheless reiterated the ECB's message that the ECB at present does not plan to ride to the rescue of the politicians once again. The markets are awaiting news on today's negotiating session in Baghdad between Iran and the P5+1 negotiators (i.e., the five permanent UN Security Council members plus Germany). Any reports of progress are likely to cause fresh weakness in crude oil prices since the chances of a military attack on Iran would become further delayed. In a display of safe-haven demand for German securities, Germany today sold 4.56 billion euros of 2-year securities with a yield of 0.07%. The security carried a zero-percent coupon for the first time.