ECB: we believe the uncertainty on the outlook will reduce the scope of next week’s announcements. Confirmation should come that PEPP net purchases will be suspended from April, but without closing the door to a possible resumption in case of need. The decision on how to ‘smooth out’ the end of PEPP purchases could be postponed until February. There will be no announcement on TLTROs, which we believe will not be renewed.

FOMC: inflation alarm! The 15 December meeting should acknowledge the increase of inflation risks amid a tight labor market, speeding up the pace of tapering and preparing for an earlier rates lift-off. In a phase of persistent excess demand, the new supply shock caused by the Omicron variant should push the Committee to an even more hawkish stance to prevent second- round effects on prices and wages.

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