The ECB’s policy support in the euro area could continue longer than previously expected as the ECB seeks to reach its new symmetrical inflation target of 2% after today’s board meeting. Showed that it could be. This dovish inclination to interest rate forward guidance strengthens the overweight stance on European equities and the neutral stance on eurozone government bonds, and explains a more modest response from bond yields in the face of rising “new nominal” investment themes. Supports. Inflation than in the past.
Today’s dovish movement, whose quantitative easing is likely to be revised upwards later this year, was made possible by the ECB’s new strategic framework announced on July 12. This was made possible for reasons contrary to the unanimously agreed strategic framework itself. , The policy making itself does not have to be made by consensus.
Therefore, even if the Governing Council hawk prevents the ECB from adopting some form of average inflation targeting in strategic reviews, pigeons could shift policy towards the deliberate tolerance of inflation overshoot. .. Against this background, staff inflation forecasts for September will be interesting to market participants.
The ECB has set a record low interest rate with an inflation target of 2%.US Unemployment Claims Increase – Business Live | Business
Source link The ECB has set a record low interest rate with an inflation target of 2%.US Unemployment Claims Increase – Business Live | Business