Exclusive News

ECB Insight: Lagarde Interview: Some PR, a Few Policy Insights and a Reprimand

By David Barwick – FRANKFURT (Econostream) – The interview that came out late Friday with European Central Bank President Christine Lagarde was not devoid of insights beyond the probably futile attempt to bolster her standing among citizens of the euro area’s largest member economy, not too delighted with the ECB to begin with and now also up in arms about rates of inflation last seen almost three decades ago.

ECB Insight: Policy Sequencing Inversion Not Base Case But Still Not Excluded

- Insider: Tapering, hiking, then downsizing balance sheet remains central scenario
- Insider: If the situation changes, we may improve on our forward guidance if necessary

ECB Brief: Weidmann: PEPP Flexibility Should Remain Reserved for Special Situations

By David Barwick – FRANKFURT (Econostream) – European Central Bank Governing Council member Jens Weidmann on Wednesday spoke out strongly about inflation risks and in support of the timely withdrawal of monetary accommodation.

ECB Insight: From Panetta, Another Impassioned Plea for at Least No Less, Maybe More

By David Barwick – FRANKFURT (Econostream) – European Central Bank Executive Board member Fabio Panetta’s speech on Wednesday confirmed – not for the first time- that surprisingly little has changed about his fundamental opposition to a withdrawal of ECB policy support.

ECB Insight: Waning Concern at the ECB About Hitting 33% Issuer Limit

By David Barwick – FRANKFURT (Econostream) – European Central Bank insiders are growing less concerned about the possibility of asset purchases running up against the 33% limit on the share of individual countries’ outstanding debt the ECB can possess, based on recent conversations with Econostream.

ECB Insight: Schnabel Hawkish on Growth, Inflation; Sceptical of Asset Buys’ Cost-Benefit Ratio

By David Barwick – FRANKFURT (Econostream) – Today’s interview by the European Central Bank’s Isabel Schnabel offered a broad and insightful view of how the most hawkish member of the Executive Board sees various key aspects of monetary policy just three weeks before one of the most important recent meetings of the Governing Council.

ECB Insight: Post-PEPP APP Purchases of Greece’s Sovereign Debt a Very Open Question

- ECB insider: Council will be divided, there will be quite substantial opposition
- ECB insider: Can’t put everything on monpol’s shoulders with no-monetary-financing clause

ECB Insight: Lagarde Speech Strikes New, More Optimistic Inflation Tone

By David Barwick – FRANKFURT (Econostream) – European Central Bank President Christine Lagarde on Friday warned of the negative growth impact from the developments driving high inflation, but the clearly more important takeaway was her new optimism about the possibility of inflation eventually getting to the point where the ECB could start raising interest rates.

EXCLUSIVE: Sweden NDO Head of Funding: Reduced Issuance to Hamper Liquidity

By David Barwick – Frankfurt (Econostream) – The Swedish National Debt Office accepts that with the government expecting a budget surplus in each of the next two years, its reduced debt issuance will contribute to less liquidity, according to Johan Bergström, Head of Funding at the NDO.

ECB Insight: Uncertainty About Inflation Outlook Leaves ECB Insiders Wondering, Too

By David Barwick – FRANKFURT (Econostream) – The crucial element of next month’s monetary policy meeting of the European Central Bank Governing Council is the inflation outlook. As Eurosystem staff gear up to make their best guesstimate amid great uncertainty, various insiders shared with Econostream reasonably similar, though still quite tentative views about medium-term prospects for price pressures in the area.

ECB Hawk-Dove Ranking: Holzmann Joins Weidmann and Knot at Hawkish End of Spectrum

ECB Insight: Holzmann Wages Lonely War on QE, but ECB Bank Credit Also Comes in for Beating

By David Barwick – FRANKFURT (Econostream) – Though there are certainly others on the European Central Bank Governing Council who are sceptical about some of what the ECB is doing, Council member Robert Holzmann seems highly unlikely at this juncture to be joined by anyone in his campaign to put an end to all quantitative easing.

ECB’s Holzmann: 'Long Story Short, This Quantitative Easing Has to Stop'

- ECB banking system credit ‘a great deal of money with very, very market-distorting effects’ 
- The pandemic, ‘economically speaking, is over’
- See inflation plateauing rather than coming back down quickly
- Dovish Bundesbank president would be ‘somewhat problematic’

ECB Hawk-Dove Ranking: Wunsch Formally Enters Hawkish Territory

- Wunsch: ‘I’m being perceived as someone who changed camps’

EXCLUSIVE: ECB’s Wunsch: We Must Recognise That the World Has Changed in the Last Three Months

- 2023 HICP forecast likely below 2%, but realised outcome could easily be at 2%
- Must be patient, but can’t exclude that inflationary forces are quite strong and at some point require reaction
- Should recognise that our models risk underpredicting inflationary pressures
- ECB faced with ‘now-or-never’ moment; ‘this is a huge opportunity to re-anchor to 2%’

ECB Insight: de Guindos Suggests Exit from Crisis Slowed by Shortages

By David Barwick – FRANKFURT (Econostream) – European Central Bank Vice President Luis de Guindos on Monday appeared to be claiming that shortages affecting economic activity were in effect hampering the euro area’s exit from the crisis.

ECB Insight: TLTROs More Likely to Be Extended Than Not, ECB Insiders Indicate

By David Barwick – FRANKFURT (Econostream) – A growing market perception that the European Central Bank is likely to continue offering targeted longer-term refinancing operations (TLTROs) on somewhat less advantageous terms in a post-pandemic world stands a decent chance of becoming reality, Econostream believes.

ECB Insight: Lagarde Repeats Rate Hike Unlikely in 2022, Passes When Asked About 2023

By David Barwick – FRANKFURT (Econostream) – European Central Bank President Christine Lagarde’s rejection on Monday of the idea that she had not countered market rate expectations with much strength neatly underscored the true motive for what was indeed the weakness of that pushback.

ECB Insight: Lagarde’s Announcement of PEPP’s End a ‘Not Very Timely’ Surprise for Some

- Should Have Been ‘Part of a Large Package’; Doubts Whether PEPP Will Really End in March
- Announcement of PEPP’s End Seen as Undercutting Pushback Against Rate Expectations

ECB Insight: Lagarde Pivots on PEPP Future From ‘Totally Premature’ to ‘It’s Time’

By David Barwick – FRANKFURT (Econostream) – Time flies at the European Central Bank, where President Christine Lagarde on Thursday unexpectedly deemed it the moment to debate, decide and announce the future of the ECB’s pandemic emergency purchase programme (PEPP).