Danske Bank's analysts have changed their call for the ECB outlook and are now expecting it to cut rates by 20bp, introduce a tiering system, extended forward guidance, and restart QE in a package which could come already in September on the back of Draghi's speech in Sintra this morning and Benoit Coeuré's interview in the Financial Times yesterday.

• “In ECB perspective, nose-diving inflation expectations and a higher probability of looming risks will materialize has caused a change in the call.
• At the annual ECB conference in Sintra, Portugal, Draghi gave another seminal speech, similar to 2017. However, this time, Draghi opened the door wide open to new easing where he was specific that 'coming weeks, the Governing Council will deliberate how our instruments can be adapted commensurate to the severity of the risk to price stability.' Importantly, there has been a huge change from ECB in past 12 days since the last GC meeting as ECB will now act if there is no improvement in the economic outlook, so that inflation to target is threatened which compares to ECB acting if downside risks materialize.”