Will Draghi’s Measures Push the Euro Lower?
As European Central Bank Governor Mario Draghi prepares to increase and broaden his bond-buying program, the shrunken market might be in for a shock. While policy makers will expand their asset-purchase plan by 20 billion euros ($22.7 billion) a month at the start of April, corporate debt won’t be included until later in the quarter. Bank of America Corp. recommends selling the euro versus the dollar to hedge the risk of the U.K. leaving the European Union on the basis that the single currency is underpricing the possibility of a “Brexit.”Analysts at the bank cite the record gap between implied pound and euro volatility as evidence. HSBC Senior FX Strategist Dominic Bunning discusses the outlook for euro and other currencies with “On the Move” host Manus Cranny in London and Hans Nichols in Berlin.