Heavy lifting at the Fed, further easing at the ECB

Societe Generale notes...

• In the US, we look for a June lift-off followed by an additional 25bp hike in Q4 and then further tightening, taking the fed funds rate to a 3.75% by H2 2018. 
  
  
• The huge balance sheet, we assume, will only gradually shrink, returning to pre-crisis levels only in around 15 years. 
  
  
• The BoE is set to follow the Fed, albeit that we see the first hike only in Q1 2016. In the euro area on the other hand, we expect asset purchases to continue beyond September 2016, albeit at a tapered pace. 
  
  
• A first ECB rate hike is only forecast for mid 2018. 
  
  
• The BoJ, moreover, is expected to deliver further easing as early as H2 2015 as inflation continues to miss its target. Caught in the cross-fire of the G4 central banks, we expect several other central banks also to ease.