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Fasdal: How to trade the ECB

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Later this Thursday, the President of the European Central Bank, Mario Draghi, is expected to deliver further stimulus to the Eurozone economy. Lowering the deposit rate by 10 basis points and adding to the bond-buying programme of between five and 10 billion euros each month are already expected by the market. 

But the ECB could go much further, says Saxo's Head of Fixed Income, Simon Fasdal. He explains what the options could be but he also admits that the ECB could disappoint the market.

So how best to trade the ECB? Simon looks at all three asset classes - bonds, equities and Forex. He explains why he is cautious when it comes to longer-term bonds and in particular 10-15 year German bunds. EURUSD could go weaker, he says. And he outlines why he thinks European corporate bonds and European equities could be the best trade. Simon pays special attention to Southern Europe especially Spain, Italy and Portugal.