News

German Bundesbank: Pandemic May Have Increased Danger of Underestimating Financial Stability Risks

By David Barwick – FRANKFURT (Econostream) – Although the financial system functioned well during the pandemic, existing vulnerabilities mounted and the risk of underestimating threats may have further increased, the German Bundesbank said on Thursday in its financial stability report for 2021.

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’s Panetta Sees Little Chance of Sustained Inflation Above 2% in the Medium Term

By David Barwick – PARIS (Econostream) – European Central Bank Executive Board member Fabio Panetta on Wednesday argued for continuing to deploy monetary policy to safeguard the recovery and restore pre-pandemic trend economic growth, a condition in his view for price stability, and said he saw ‘little chance of sustained inflation above 2% in the medium term.’

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’s Makhlouf: If Current Trends Persist, Case for Policy Action Becomes Stronger

By David Barwick – FRANKFURT (Econostream) – European Central Bank Governing Council member Gabriel Makhlouf on Tuesday said that monetary policy should sit tight for the moment, but that a continuation of current inflation developments would strengthen the case to act.

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’s Villeroy: Should Keep as Much PEPP Flexibility as Possible

By David Barwick – FRANKFURT (Econostream) – The European Central Bank should preserve as much as possible of the flexibility of its pandemic emergency purchase programme (PEPP) after the PEPP ends in March, Governing Council member François Villeroy de Galhau said Monday.

German Bundesbank Sees German Economy Treading Water in 3Q, Inflation over 3% for Some Time

By David Barwick – FRANKFURT (Econostream) – The German economy is likely to put growth on hold for the moment, while consumer price inflation would remain above 3% for months to come, the German Bundesbank said on Monday in its latest monthly report.

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’s Weidmann: Inflation May Not Fall Below Target over Medium Term

By David Barwick – FRANKFURT (Econostream) – Risks to inflation are tilted to the upside, European Central Bank Governing Council member Jens Weidmann said Wednesday.

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: Macroprudential Policy Limits Can Increase Need for Aggressive Monetary Accommodation

By David Barwick – FRANKFURT (Econostream) – Limitations in the current macroprudential policy framework can make forceful monetary policy accommodation more necessary, the European Central Bank said on Wednesday.

ECB Hawk-Dove Ranking: Wunsch Formally Enters Hawkish Territory

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

ECB’s Schnabel: Must Be Patient, But Also Watch Upside Inflation Risks

By David Barwick – FRANKFURT (Econostream) – Monetary policymakers have to be patient in the face of possibly only temporarily high inflation, but at the same time be attentive to upside risks, European Central Bank Executive Board member Isabel Schnabel said Wednesday.