Lagarde speech: Neither committed to raise further nor are we finished with hiking rates
…
This is a premium post.
[s2If !current_user_can(access_s2member_level4)]Please register for PREMIUM VERSION HERE to read full post below containing analysis. In case of any error or you think you are not able to read the full post below, please email us at support#nehcap.com [lwa][/s2If] [s2If current_user_can(access_s2member_level4)]
European Central Bank (ECB) President Christine Lagarde reiterated on Wednesday that underlying inflation dynamics in the Eurozone remain strong, as reported by Reuters.
“We must and we will bring down inflation to target.”
“Times are very uncertain.”
“Inflation is still high and uncertainty around its path ahead has increased.”
“While more restrictive credit conditions are part of the mechanism by which our tightening ultimately brings inflation back to target, we will make sure that the process will be orderly.”
“We are neither committed to raise further nor are we finished with hiking rates.”
“If, for example, banks start to apply a larger intermediation wedge – then transmission is stronger.”
“Recent tensions have added new downside risks and have made the risk assessment blurrier.”
“The greater role today played by sectors that rely on discounted future earnings, such as tech, could also make monetary transmission more powerful.”
“We do not see clear evidence that underlying inflation is trending downwards.”
“Excess savings and the low pass-through to deposit rates could mean a weaker pass-through to consumption.”
“We could see a more prolonged cost-push shock coming from wage growth.”
“It is important that our monetary policy works robustly in the restrictive direction and that process is only starting to take effect now.”
EUR/USD has gained traction following these comments and was last seen rising 0.13% on the day at 1.0780.
[/s2If]
Join Our Telegram Group
