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ECB: Difference between revisions
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* The ECB kept options foe September meeting open.<blockquote>The Governing Council’s future decisions will ensure that the key ECB interest rates will be set at sufficiently restrictive levels for as long as necessary to achieve a timely return of inflation to the 2% medium-term target. The Governing Council will continue to follow a data-dependent approach to determining the appropriate level and duration of restriction," the statement added.</blockquote> | * The ECB kept options foe September meeting open.<blockquote>The Governing Council’s future decisions will ensure that the key ECB interest rates will be set at sufficiently restrictive levels for as long as necessary to achieve a timely return of inflation to the 2% medium-term target. The Governing Council will continue to follow a data-dependent approach to determining the appropriate level and duration of restriction," the statement added.</blockquote> | ||
* The rate hike was widely expected by the market. | * The rate hike was widely expected by the market. | ||
=== September 14 2023 === | |||
* ECB hikes interest rates by 25 basis points while pointing out that “Inflation continues to decline but is still expected to remain too high for too long.”<ref>https://www.ecb.europa.eu/press/pr/date/2023/html/ecb.mp230914~aab39f8c21.en.html</ref><ref>https://www.ecb.europa.eu/press/pressconf/shared/pdf/ecb.ds230914~bfc89c4456.en.pdf</ref> | |||
* ECB said that the decision reflects an upward revision in macroeconomic projections, which sees inflation averaging 5.6% in 2023, 3.2% next year and 2.1% in 2025. | |||
* ECB staff have lowered their economic growth projections significantly. They now expect the euro area economy to expand by 0.7% in 2023, 1.0% in 2024 and 1.5% in 2025. | |||
* The policymakers suggested that the interest rates are now at a level deemed as the peak and that future decisions will be informed by incoming data.<blockquote>“Based on its current assessment, the Governing Council considers that the key ECB interest rates have reached levels that, maintained for a sufficiently long duration, will make a substantial contribution to the timely return of inflation to the target. The Governing Council’s future decisions will ensure that the key ECB interest rates will be set at sufficiently restrictive levels for as long as necessary. The Governing Council will continue to follow a data-dependent approach to determining the appropriate level and duration of restriction,” the statement said.</blockquote> | |||
* The market was largely divided on the ECB’s next move but by Thursday morning the prabability of an hike had risen to 63% following a Reuters article which said the ECB expects euro zone inflation to remain above 3% in 2024. | |||
== References == | == References == | ||