* Investors buy euro zone banks, exporters
* Bets on more stimulus mount as inflation expectations stay low
* QE announcement may take time as ECB waits for economic reforms
By Francesco Canepa
LONDON, Sept 19 (Reuters) - Investors are piling into European banks and exporters, betting that the European Central Bank will crank up the money printing presses to tackle stubbornly low inflation.
The ECB's latest batch of stimulus measures - which added purchases of asset-backed debt and a further rate cut to previously announced cheap loans to banks - is seen as paving the way for bolder action in the coming months, which would further push down the euro and set up banks for tidy trading profits.
The ECB has so far resisted calls for outright quantitative easing like that carried out by the Federal Reserve and the Bank of England, who bought billions of dollars worth of government bonds with newly created money. The ECB has argued it would not be as effective in Europe, where most commercial lending goes through the banking channel.
Yet with the ECB's own preferred measure of the market's long-term inflation expectations at its lowest this year and the first round of four-year loans attracting lower-than-expected demand, many are betting the central bank will have little choice.
"It might take some time...but we are expecting some more to come," said Eric Verleyen, group chief investment officer at Societe Generale Private Banking Hambros, which manages 8 billion pounds.
"We especially like the financials and...are structuring a basket of equities that should benefit from a weaker euro."
Among them he cited Michelin, a French tyre-maker which generates 60 percent of its revenues outside Europe.
Even investors who believe monetary stimulus would fail to spur enduring growth if it is not accompanied by economic reform are seeking to take advantage of the prospect of more ECB largesse in the coming months.
"Monetary policy can only achieve so much, so that makes me wary of European equities in the medium term," said Manish Singh, director and head of investment services at Crossbridge Capital.
"In the meantime, however, if it is accompanied by a weaker euro, it helps the earnings for the next quarter or two," he said.
Singh has been buying shares in exporters such as German auto maker Volkswagen, betting on a short-term boost to earnings from a weaker euro, as well as large banks such as BNP Paribas and Deutsche Bank.
CARROT IN FRONT OF A DONKEY
Yet full-blown quantitative easing (QE) may take some time to arrive as ECB President Mario Draghi wants to see signs governments are following through on his recommendation for deeper economic reforms before providing more stimulus.
"Draghi is interested in going slow, but to keep it like a carrot in front of a donkey," Tom Elliott, international investment strategist at De Veere Group.
"I think that we will eventually get Anglo Saxon style quantitative easing that will mean investors buying euro zone stocks enthusiastically in expectation of lots of money in the market looking for a home."
The road to Fed-style QE is fraught with hurdles, however, starting with Germany's concern that it would lower the pressure on other countries to carry out painful reforms.
"Real QE would help and it will, because we remain convinced that the ECB will do it eventually," said Luca Paolini, chief strategist at Pictet Asset Management, which has upgraded European shares to "neutral" from "underweight" following the ECB's announcements earlier this month.
"But in Europe you still have political obstacles to that. This means there's always a risk that something doesn't go as planned." (1 US dollar = 0.6104 British pound) (Reporting by Francesco Canepa; Editing by Lionel Laurent and Toby Chopra)