Sure, the RBA froze interest rates on Tuesday, but there's plenty of pain to come 
What central banks are doing to safeguard financial stability and why they must proceed with caution 
The RBA has kept interest rates on hold. Here's why it'll be cautious from here on 
Today European Central Bank (ECB) is to provide further guidance in policy meet. Result to be announced at 12:45 GMT, followed by a press conference at 13:30 GMT. The meeting is to be held in Frankfurt, Germany.
Current policy measures–
- Deposit facility rate at -0.40 percent
- Refinancing rate 0.00 percent
- Marginal lending facility rate at 0.25 percent
- ECB had launched four new TLTROs.
- Assets can be bought at yields below the deposit rate.
- In the last meeting, ECB tapered asset purchases to €30 billion and extended the program until September 2018. The current program was due to expire at the end of the year.
Expectation today –
- European Central Bank (ECB) is expected to maintain its current policy.
- With ECB taking action at the last meeting, there is no change expected.
What to watch out for –
- Change in inflation forecast.
- Take on tapering or on the future path of monetary policies.
- ECB’s take on Greece debt restructuring, which is still lingering.
- The high level of NPLs in European banks, especially in Italy.
- Does ECB leave the door open for further interest rate cut or the next move to be a hike? How soon might such come?
- Concerns with regard to European banks’ balance sheet and call for the creation of a pan European bad bank.
- Contingency plans from the Brexit fallouts.
- What are the major risks for Eurozone in 2018?
- Whether ECB seems comfortable with the level of the Euro or does Draghi talk the currency down.
Impact –
The euro has remained upbeat despite the European Central Bank (ECB) extending the asset purchase program beyond expectation. We expect the euro to move higher after ECB meeting.
