Danske Bank's analysts expect the long-awaited ECB meeting on 12 September to set the scene for months and potentially quarters to come.

• “The question is not if the ECB will announce new initiatives but how much it will deliver.
• We expect the ECB to announce (1) a 20bp cut in the deposit rate (other key rates unchanged) and that the extended forward guidance ('at present or lower...well past the horizon of net asset purchases') will remain; (2) a 12-month QE restart of EUR45-60bn per month, albeit also acknowledging the downside risks given the recent hawkish communications from a few Governing Council members; and (3) a tiering system.
• The package is not likely to be a silver bullet for markets. The FX market is set to keep its focus on the rate cut, while the fixed income markets focus on the size of QE.”