Business

As expected, at least based on its less informative press release, the ECB remains in "wait and see" mode by keeping all three interest rates unchanged. The ECB also said that on 8 June the Eurosystem will start making purchases under its corporate sector purchase programme (CSPP). It adds that starting on 22 June, it will conduct the first operation in its new series of targeted longer-term refinancing operations, and will share more details in the press conference.

Full statement:

Monetary policy decisions

 

2 June 2016 

 

• Global stocks struggle as ECB and OPEC meetings loom (Reuters)
• Iran Resists Saudi Gesture for Unity as OPEC Fractures Reappear (BBG)
• Clinton to blast Trump on North Korea, NATO in foreign policy speech (Reuters)
• Hillary Clinton Shifts to California as Race Tightens There (WSJ)
• Puerto Rico’s U.S. Rescue Won’t Come Soon Enough to Halt Default (BBG)
• U.S. to Curb Payday Lenders (WSJ)
• BOJ’s Sato Is Pessimistic on Economy, Central Bank’s Strategy (BBG)
• PIMCO sees 'significant' chance of Brexit vote in UK (Reuters)

With the ECB announcement due in a few minutes, followed by Draghi's press conference, today's ECB meeting should be a relatively dull affair as they are currently in 'wait and see' mode with regards to previous policy actions. As RanSquawk notes, general consensus among analysts is that the ECB are to keep rates on hold this month and avoid added stimulus.

With the OPEC meeting having started a little under two hours ago, it appears that the premature optimism raised yesterday about yet another imminent production freeze deal may have been mostly hot air. Indeed, yesterday's bounceback in oil was driven by the various reports of a potential reintroduction of a ceiling on production after the previous ceiling was scrapped in December. The WSJ ran a story suggesting that the willingness is shared by Saudi Arabia as well as smaller producers in Nigeria, Qatar, Algeria and Venezuela.

What does one hundred trillion dollars buy you?

How about a mansion in every country, an airplane at every airport and a private island in every ocean?

How about 3 eggs?

When Zimbabwe issued its infamous 100 000 000 000 000 dollar bill, it could buy 3 eggs on the day it was issued. A few days later, it could only buy one egg.

Hyperinflating Currencies