Duhani Capital’s Post

🔔 ECB Has Some Concerns About Inflation: Minutes ! ECB policymakers raised some doubts about whether the Euro Area recovery would take place as expected, since it depended on a pick-up in private consumption for which there was no convincing evidence in the data yet, minutes from the ECB monetary policy meeting in June showed. Also, some members felt that the data available had not increased their confidence that inflation would converge to the 2% target by 2025 but instead pointed to greater uncertainty in the outlook. The ECB lowered the 3 key interest rates by 25bps in June, a shift from nine months of stable rates. However, it stressed it will maintain a data-dependent and meeting-by-meeting approach and that there should be no pre-commitment to a particular rate path. Policymakers also remain determined to ensure that inflation returned sustainably to the 2% target in a timely manner and affirmed that they would keep policy rates sufficiently restrictive for as long as necessary to achieve it. source: European Central Bank

🚨 ECB Set to Cut Interest Rates to 4.25%! 🚨 The ECB is anticipated to lower rates by 25bps, despite a recent increase in inflation. What does this mean for the price of EURUSD? 🌍📉 #ECB #InterestRates #Eurozone #Economy #Inflation #FinanceNews Watch the video to learn more… https://lnkd.in/efgmagJr

As expected, the ECB cut rates by 25 basis points. The forecast revisions that accompanied this policy action lowered growth and maintained worries about somewhat sticky inflation. The press conference of Christine Lagarde, the ECB president, will be closely watched. #economy #inflation

💸 ECB: Commitment Back to Inflation Targeting 📊 The ECB is determined to ensure inflation returns to the 2% target in the medium term. 🛍 The ECB will maintain interest rates sufficient to suppress inflation for as long as necessary. 🕯 The ECB will continue to follow a data-driven approach and make decisions from one meeting to another. 🚫 The ECB will not pre-commit to a specific rate path. 📉 The ECB is ready to adjust all its instruments in the mandate to ensure inflation returns to the 2% target in the precautionary rate. ⚠️ This approach can increase investor confidence in the ECB's efforts to control inflation. Not being tied to a specific rate path allows the ECB to be more flexible in dealing with global and local economic changes.

The cumulative impact of the aggressive interest rate hikes implemented by the ECB and the Federal Reserve is being felt across the European and US economies, affecting various sectors and continuing to weigh on growth. The lagged effects of these policy actions are dampening economic growth, as higher borrowing costs weigh on consumer spending, business investment, and overall confidence. The U.S. projects GDP growth at 2.1% for 2024, with sectors like real estate feeling the pinch of higher borrowing costs. In Europe, the ECB's recent rate cut aims to support growth, yet economic expansion remains modest with projections of 1.4% for 2025. The careful calibration of monetary policy is crucial as central banks seek to mitigate the adverse impacts of past rate hikes while fostering sustainable economic activity. After all, nobody wants the economy to hit the snooze button indefinitely! #ecplu #valueinvesting #equities #longterminvesting

I am happy 😀 to have had the opportunity once again to contribute a paper to the ongoing Monetary Dialogue of the European Parliament (Economic Governance and EMU Scrutiny Unit (EGOV)). ⬇ ➡ The title of my paper is "From Aggressive Rate Hikes to Gradual Easing: The ECB's Evolving Monetary Policy Stance Amidst Persistent Services Price Pressures". ➡ A short summary: "The ECB’s interest rate hikes since 2022 aimed to curb inflation by tightening financial conditions and dampening aggregate demand. While price pressures for food and goods have eased, persistent inflation in the services sector remains a key concern. Although the ECB is expected to gradually ease its restrictive stance by 2025, inflation challenges could re-emerge. The ECB should be careful not to undermine its commitment to price stability by loosening monetary policy too aggressively.". ➡ Full paper available below and on the European Parliament homepage: https://lnkd.in/edCwyKaW Let's discuss! 😉 😀

"European Central Bank (ECB) keeps interest rates on hold but hints at future cuts" The European Central Bank (ECB) maintained its record-high borrowing costs but hinted at potential future rate cuts as inflation eased more rapidly than anticipated. Despite leaving the main interest rate at 4.0%, the ECB acknowledged the continued decline in inflation over the past 1-1/2 years and revised economic projections downward. The central bank emphasized the persistence of high domestic price pressures due to strong wage growth. The ECB President, Christine Lagarde, is expected to cautiously assess the situation in a press conference, emphasizing the need for more evidence regarding wage increases' impact on inflation. The ECB's economic projections included a cut in the inflation forecast for this year from 2.7% to 2.3%, possibly reaching the 2% goal earlier than expected. Investors anticipate potential rate cuts in the coming months, depending on wage data to be available in May. The ECB's policy tightening, aimed at combating inflation, has impacted economic growth, with GDP projections lowered from 0.8% to 0.6%. Despite growing discussions about a future rate cut within the ECB Governing Council, specific actions may depend on upcoming data, with June mentioned as a possible date for rate adjustments. Source: Reuters #investment #investmentstrategy #investmentplanning #investmentinsights #europe #ECB #InterestRates #Inflation #EconomicProjections #CentralBank #RateCuts #FinancialMarkets #Investors #EuroZone #MonetaryPolicy #GlobalEconomy #WageGrowth #GDPForecast #MarketImpact #PolicyDecisions #FinancialOutlook

ECB Watch: No changes, some signals! The ECB kept key interest rates unchanged at today's meeting. Regarding the timing of a first rate cut the ECB kept a low profile in its official statement, only for President Lagarde to provide some signals during the press conference. New projections show mildely lower inflation and economic growth for 2024. Today's ECB meeting is fully in line with our expectations, which is why we are sticking to our view of a first rate cut in June. 📌 Find the full publication by Franz Xaver Zobl in the comment section below.

⚠ #Eurozone Faces Recession, Pick Up in Inflation ! The #ECB maintained interest rates at multi-year highs for the second consecutive meeting and signaled an early conclusion to its last remaining bond purchase scheme, all as part of efforts to combat high #inflation. The main refinancing operations rate remained at a 22-year high of 4.5%, while the deposit facility rate held steady at an all-time record of 4%. The ECB also said full reinvestment under the #PEPP will end on June 30 and the portfolio will then fall by €7.5 billion per month until the end of 2024. #Policymakers have also pledged to maintain rates at sufficiently restrictive levels for as long as necessary. The ECB has projected #inflation to average 5.4% in 2023, 2.7% in 2024, 2.1% in 2025 and 1.9% in 2026. The core rate is seen slightly higher at 5.0% in 2023, 2.7% in 2024, 2.3% in 2025 and 2.1% in 2026. During the press conference, President #Lagarde told reporters that policymakers did not discuss any rate cuts, reiterating that future decisions would be data-dependent. source: European Central Bank

The International Monetary Fund (IMF) has warned central banks to be cautious about cutting interest rates too quickly, as market expectations of looser monetary policy could lead to a flare-up of inflation. Gita Gopinath, the first deputy managing director of the IMF, stated that inflation is expected to decline less sharply this year due to tight labor markets and high services inflation in various regions. She suggested that official rates should not be lowered until the second half of the year. The IMF cautioned against solidifying expectations of further rate cuts, which could have counterproductive effects. #IMF #centralbanks #interestrates #monetarypolicy #inflation #economy #financialmarkets Source: Financial Times, ChatGPT https://lnkd.in/ezt2dgyh