By David Barwick – FRANKFURT (Econostream) – Some observers of the European Central Bank have reacted to the July euro area inflation data released Wednesday by reflexively inferring that they materially reduce the chances of a September rate cut. We feel a shrug would be the more appropriate reaction.
31 July 2024
By David Barwick – FRANKFURT (Econostream) – Hawkish though she may seem at first glance, European Central Bank Executive Board member Isabel Schnabel’s interview from Friday changes little to nothing in our view, and it is possible it was never meant to do much more.
29 July 2024
By David Barwick – FRANKFURT (Econostream) – With one sentence, European Central Bank Vice President Luis de Guindos on Tuesday seems to have established what information September has to bring for the Governing Council to cut interest rates again. Less explicitly, but to our mind nonetheless unambiguously, he conveyed the expectation that the conditions for more easing would be met eight weeks from now.
23 July 2024
By David Barwick – FRANKFURT (Econostream) – Though we wouldn’t want to overstate the importance of a single set of comments from one of the quieter members of the European Central Bank’s Governing Council, we note with interest a possible shift in the attitude of Peter Kažimír.
22 July 2024
By David Barwick – FRANKFURT (Econostream) – Having so aptly entitled our pre-ECB press conference analysis ‘No Signals, No Flags, No Guidance, No Promises’, our post-presser analysis might exude a certain satisfaction. It won’t. Instead, we see the need to very slightly modify a central prediction from Tuesday.
19 July 2024
By David Barwick – FRANKFURT (Econostream) – It is a struggle to come up with much about the European Central Bank Governing Council’s current policy stance that monetary authorities are likely to want to change this week. The key interest rates should figure near the bottom of any list.
16 July 2024
By David Barwick – HELSINKI (Econostream) – European Central Bank Governing Council member Fabio Panetta on Wednesday expressed a surprisingly dim view of his Finnish colleague’s disregard earlier in the day for the ECB’s data-dependent, meeting-by-meeting approach to policymaking.
26 June 2024
By David Barwick – FRANKFURT (Econostream) – It is truly remarkable to what extent European Central Bank Governing Council members diverge in their interpretation of what a data-dependent, meeting-by-meeting approach to policymaking means in practice.
26 June 2024
By David Barwick – FRANKFURT (Econostream) – More than anything else, Tuesday’s interview of European Central Bank President Christine Lagarde with various European newspapers was an answer to the question, ‘How do you say Holzmann was right without saying Holzmann was right?’
11 June 2024
By David Barwick – FRANKFURT (Econostream) – The opposition of Austrian National Bank Governor Robert Holzmann to the European Central Bank’s decision yesterday to cut interest rates by 25bp must have been somewhat of a surprise not just to a large number of his fellow Governing Council members, but to Holzmann himself.
7 June 2024
By David Barwick – FRANKFURT (Econostream) – European Central Bank President Christine Lagarde on Thursday succeeded in leaving even more uncertain than might have been expected the timing of any further interest rate cuts, though without undermining the idea that more monetary policy easing would be coming as the disinflation process continued and wages ultimately softened.
6 June 2024
By David Barwick – FRANKFURT (Econostream) – A July rate cut by the European Central Bank appears unlikely, given the need for the ECB to proceed with easing carefully and supported by data every step of the way, in the opinion of several insiders who spoke to Econostream very recently.
5 June 2024
By David Barwick – FRANKFURT (Econostream) – Much of what filled this space ahead of the 11 April monetary policy meeting of the European Central Bank Governing Council remains valid now, starting with the idea that, as we said at the time, ‘a first rate cut in June should be everyone’s central scenario.’
4 June 2024
By David Barwick – FRANKFURT (Econostream) – There having been essentially no question for some time about the main decision to emerge from the European Central Bank Governing Council’s 6 June meeting, Monday’s confirmation of the imminent rate cut by Executive Board member Philip Lane is less newsworthy than his other comments - and what he failed to say.
27 May 2024
By Isabel Teles – BONN, Germany (Econostream) – European Central Bank Executive Board member Isabel Schnabel on Friday said that that there were divergent views on the Governing Council about cutting interest rates, and that a consensus to cut in June would require a compromise.
24 May 2024
By David Barwick – FRANKFURT (Econostream) – European Central Bank President Christine Lagarde on Tuesday seemed to want to frame a potential June rate cut in strictly conditional terms, meaning data-dependent, only to then utter words that we understood as firmly endorsing a cut and indeed policy easing in general.
22 May 2024
By David Barwick – FRANKFURT (Econostream) – When European Central Bank Governing Council members of such disparate stripes as Austrian National Bank’s Robert Holzmann and De Nederlandsche Bank’s Klaas Knot on the hawkish side or Bank of Greece Governor Yannis Stournaras and Banco de España head Pablo Hernández de Cos on the dovish side all clearly expect the ECB to start loosening monetary policy in June, then a first rate cut in June should be everyone’s central scenario.
10 April 2024
By David Barwick – FRANKFURT (Econostream) – European Central Bank Executive Board member Piero Cipollone on Wednesday faithfully carried on the tradition of his predecessor with a speech intended above all to undermine the ECB’s unjustifiably timid approach to monetary easing.
27 March 2024
By David Barwick – FRANKFURT (Econostream) – European Central Bank President Christine Lagarde on Wednesday made it clearer yet that the ECB would before long, most probably in June, start easing its monetary policy stance, even in the absence of complete certainty about the choice of timing.
20 March 2024
By David Barwick – FRANKFURT (Econostream) – The European Central Bank Governing Council appears headed for a series of rate cuts of 25bp each, with the question of whether these cuts should only occur in conjunction with projection meetings still very much up in the air.
19 March 2024