FPXE - Rates Spark: Don't Rock The Boat

• For financial markets, the acceleration of European vaccination programs and the resilient confidence surveys in the face of tighter restrictions are reason enough to price the start of an economic recovery. For central banks, they are welcome but too tenuous to drive a change of policy.
• The speedup of ECB asset purchases was announced at the March meeting, so today’s press conference should be more about biding time until June when the purchase pace is up for reassessment.
• We think risks are skewed towards higher rates, as it might not take much to confirm the market’s more bullish views on the economy.

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