Post by account_disabled on Feb 26, 2024 23:41:00 GMT -5
There are potential risks for the ECB in any decision it makes: keeping rates unchanged invites criticism for giving up too soon in the fight against inflation, but raising them risks worsening an impending economic slowdown. Ahead of Thursday's decision, Dutch central bank chief Klaas Knot said investors could be underestimating the possibility of a rate hike, not least because persistently high wage growth remains "quite far away" from the level compatible with inflation falling to 2 percent of the ECB. cent goal. Others, such as Germany's central bank chief Joachim Nagel and Belgian governor Pierre Wunsch, have echoed those concerns. "If they don't rise in September, the window will close," said Frederik Ducrozet, head of macroeconomic research at Pictet Wealth Management. "GDP growth is about to contract and credit growth is slowing rapidly.
Whatever happens, this week's decision is seen as the most difficult to make since before the ECB began raising borrowing costs in July 2022, further complicated by a lack of signals from the central bank on his next Jordan Mobile Number List move for the first time in over a year. The ECB, led by President Christine Lagarde, has raised borrowing costs in nine consecutive policy meetings, raising its benchmark deposit rate from a record low of -0.5 percent to a record high of 3.75 percent. in an effort to tame the elders. inflationary rise for a generation. More "moderate" members, such as Portugal's central bank chief Mário Centeno, say the risk of "doing too much" has become "material" as the outlook for the eurozone economy has deteriorated in recent weeks.
last weeks. Ignazio Visco, governor of Italy's central bank, said: "I think we are close to the level where we can stop raising rates," citing measures of underlying inflation pressure that show it is declining. ECB President Christine Lagarde has seen nine consecutive rate hikes © Boris Roessler/dpa Investors are betting on a pause, as derivatives markets price in just a 35 percent chance that the ECB will raise its deposit rate to 4 percent on September 14. The possibility of higher rates fell last week after data revealed a drop in business activity, production and a downward revision of eurozone growth in the second quarter from 0.3 percent to 0.1 percent. hundred. Inflation in the eurozone has halved since last year to 5.3 percent in August.
Whatever happens, this week's decision is seen as the most difficult to make since before the ECB began raising borrowing costs in July 2022, further complicated by a lack of signals from the central bank on his next Jordan Mobile Number List move for the first time in over a year. The ECB, led by President Christine Lagarde, has raised borrowing costs in nine consecutive policy meetings, raising its benchmark deposit rate from a record low of -0.5 percent to a record high of 3.75 percent. in an effort to tame the elders. inflationary rise for a generation. More "moderate" members, such as Portugal's central bank chief Mário Centeno, say the risk of "doing too much" has become "material" as the outlook for the eurozone economy has deteriorated in recent weeks.
last weeks. Ignazio Visco, governor of Italy's central bank, said: "I think we are close to the level where we can stop raising rates," citing measures of underlying inflation pressure that show it is declining. ECB President Christine Lagarde has seen nine consecutive rate hikes © Boris Roessler/dpa Investors are betting on a pause, as derivatives markets price in just a 35 percent chance that the ECB will raise its deposit rate to 4 percent on September 14. The possibility of higher rates fell last week after data revealed a drop in business activity, production and a downward revision of eurozone growth in the second quarter from 0.3 percent to 0.1 percent. hundred. Inflation in the eurozone has halved since last year to 5.3 percent in August.