ECB officials are edging towards a 2022 rate hike to stem inflation - Bloomberg

Joel Frank Independent Analyst

European Central Bank policymakers are edging towards a rate hike before the end of 2022 to stem more persistent than expected inflationary pressures and a stronger inflation outlook, Bloomberg reported on Friday citing ECB sources. A consensus is emerging ahead of the March meeting that would set September as the end date for asset purchases, the sources continued.

Market Reaction

The euro has not reacted to the latest ECB sources reported by Bloomberg. The hawkish drift in opinions held by ECB policymakers has been on full display since the early February meeting, where Lagarde at the time opened the door for a 2022 rate hike by refusing to rule it out as she had done in the past. In more recent days/weeks, prominent ECB policymakers have hinted towards a faster pace of tightening in 2022, with some explicitly outlining timelines that would see QE ended in Q3 and rate hikes in Q4.

Author

Joel Frank

Independent Analyst

Joel Frank is an economics graduate from the University of Birmingham and has worked as a full-time financial market analyst since 2018, specialising in the coverage of how developments in the global economy impact financial asset

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