Thomas Harr, Global Head of FICC Research at Danske Bank, finds the most recent ECB’s measures positive for risky assets as they, after all, are targeting the bank lending, credit channel and thereby economic growth rather than the currency channel, which is a zero-sum game. Key Quotes “As such, the ECB’s decision is a further shot in the arm for equity and credit markets. In FX markets, the measures are bullish for the EUR against other low yielding currencies such as the USD, GBP and JPY. We continue to see EUR/USD in a 1.05-1.15 range. However, the ECB exiting the currency war supports our long held view that EUR/USD will head substantially higher in 2016, eventually breaking the 1.15 level. The menu of easing measures should imply gradually flatter curves in core European fixed income (FI) markets with the front end being anchored. Investors, banks and other market players should gradually seek further out on the yield curve. The risk is that these could be seen as the last measures from the ECB, which could drive a sell-off from the long end, but that is not our base case.” For more information, read our latest forex news.