BofAML's Preusser Sees Truce Between Hawks, Doves at ECB

The video discusses the European Central Bank's (ECB) potential rate hike and market expectations, highlighting the balance between hawkish and dovish stances. It examines the ECB's messaging, inflation concerns, and economic growth, noting the unusual growth rate in Europe compared to the US. The discussion shifts to bond spreads, Treasury yields, and central bank activities, emphasizing the role of Japanese investors and FX reserves. Finally, the video covers US Treasury yields, rate hikes, and economic forecasts, questioning whether current conditions indicate a bear market for rates.

What is the market's expectation regarding the ECB's rate hike by mid-2018?

• The market is uncertain about the rate change.

• The market expects a rate hike.

• The market expects a rate cut.

• The market expects no change in rates.

Why is it important for the ECB to focus more on core inflation?

• Core inflation is higher than headline inflation.

• Core inflation is below 1% and shows no sign of life.

• Core inflation is more volatile.

• Core inflation is not affected by seasonal changes.

What has been a significant driver of growth in Europe compared to the US?

• Consumption

• Increased government spending

• Higher exports

• Technological advancements

What is a major factor affecting bond spreads between the US and Europe?

• Trade agreements

• Political risks in Europe

• Central bank policies

• Currency exchange rates

What is the expected target for the US 10-year Treasury yield by mid-year?

• 2.5%

• 2.6%

• 3.5%

• 3%