MUFG Research discusses its expectations for next week's ECB policy meeting.
"We expect the ECB to signal next week that “purchases will be maintained at around the current pace”. The market reaction should be limited as euro-zone yields have already adjusted lower in recent weeks. In the first hour following the last two ECB policy decisions the EUR has weakened marginally. We expect a similar reaction this time around.," MUFG notes.
" The FX options market has been pricing in some modest downside EUR risk with one-week implied volatility picking up," MUFG adds.