What is the ECB Transmission Protection Instrument (TPI)?

The main focus of research in our fixed income feed was the ECB's new Transmission Protection Instrument (TPI). Most research was positive on this anti-fragmentation tool and it's clear objective - an unlimited bond buying backstop to facilitate the transmission of monetary policy across the EU. However, details on how it would work in practice with respect to peripheral countries, and particularly Italy, remain less  clear.

Related to this theme was the ECB's decision to raise rates last week by 50 basis points. Almost all managers expected 25 basis points based on the forward guidance. As such, many managers are now questioning the credibility of forward guidance in an inflationary world.

Lots of questions remain.