ECB Vice President Luis de Guindos said on Thursday that price increases across the Eurozone will most likely remain high over the coming months, reported Reuters. Medium-term inflation expectations remain anchored and close to our 2.0% target, de Guindos added. The ECB needs to move gradually and cautiously as it normalises monetary policy, he noted.
ECB left its benchmark deposit rate unchanged at -0.50%
EUROPEAN CENTRAL BANK EMERGENCY MEASURES
European Central Bank Governing Council member Ignazio Visco told Bloomberg TV on Friday that a rate hike in June was out of the question but added that July could be the time to start raising rates, as reported by Reuters.
European Central Bank (ECB) policymaker Madis Muller said Friday that the focus needs to be on fighting high inflation. Earlier on, his colleague Martins Kazaks said he “hopes that first rate hike will take place in July.”
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APRIL MEETING REVIEW
The European Central Bank left its benchmark deposit rate unchanged at -0.50% on Thursday as unanimously expected by analysts. The central bank also reiterated its guidance that net asset purchases (Quantitative Easing or QE) should end in Q3.
Price pressures have intensified – and that is where the European Central Bank's hawkishness ends. All the rest is dovish, and that is why the euro is under pressure in response to this decision. There may be more to come.
MARCH MEETING REVIEW
Inflation in the US, as measured by the headline Consumer Price Index (CPI), rose to 7.9% YoY in February, up from 7.5% in January, the US Bureau of Labor Statistics reported on Thursday. That was in line median economist forecasts for a reading of 7.9%.
Influenced by inflation, (almost) ignoring the war – the European Central Bank has announced a fast pace of tapering its bond-buying scheme as prices rise and despite the adverse effects of Russia's invasion of Ukraine.
February meeting review
The European Central Bank opted to leave its deposit rate unchanged at -0.5% on Thursday as unanimously expected. The bank maintained its guidance on interest rates, saying they would remain at present or lower levels until the conditions for a rate hike have been met. The bank also reaffirmed its QE policy guidance from December; that the PEPP will end in March, that in Q2 the APP will be lifted to EUR 40B per month, then tapered back to EUR 20B per month by Q4, while PEPP reinvestments will continue to the end of 2024.
November meeting review
Will 2022 be like 2019? That is what many people are hoping for, after nearly two years with covid. Hopes for next year also seem to guide the European Central Bank, which is why EUR/USD has room to lose its recent gains – related to weak US GDP. ECB President Christine Lagarde cited three critical factors that have pushed inflation higher.
September meeting review
The European Central Bank (ECB) decided to leave the interest rates on the main refinancing operations, the marginal lending facility and the deposit facility unchanged at 0.00%, 0.25% and -0.50%, respectively, as expected.