EUR: CA retains its bearish outlook, believes ECB may become even more aggressive

In a brief note published today, Credit Agricole confirms its EUR sell recommendation in the event of a rally.

The bank emphasises that "the weakening of commodity prices should increase the downside risks that weigh on inflation, especially if domestic demand conditions appear insufficient to compensate for external factors.

Thus, the ECB's monetary policy has no reason to become less dovish. Instead, we can not exclude that the ECB may become even more aggressive, at least verbally."