Ultima Markets: 【 Market Hot Spots 】 The debate between hawks and doves in the European Central Bank's interest rate meeting...

Eurozone from2022year7Interest rates have risen since the beginning of the month4.25Percentage points. But as the signs of impending recession in the region become increasingly apparent, the current annual price growth rate is10.6% At half the peak, regarding the future trend of interest ratesECBInternal disagreements arise. Some officials tend to add25 bpsSome officials hope to suspend interest rate hikes.

At the end of the summer, the activity indicators of the manufacturing and service industries in the eurozone showed signs of an imminent economic slowdown. Higher interest rates3.75%~4.50% Restricted bank lending. In fact,9month11The European Commission of Japan has shifted the growth prospects of the eurozone this year from 1.1%Down to 0.8%Due to the contraction of Germany, the largest economy among them.

Three aspects increaseECBDecision difficulty:

1.          Core inflation is still at a high level, although it has slowed down, the growth rate last month was5.3%, much higher than the historical average. Due to the tense labor market, especially in the service industry, annual wage growth exacerbates price pressure.

2.          The rise in oil prices,OPEC+Allied production cuts and strikes at Australian liquefied natural gas plants have added more variables to the eurozone economy. Prices may remain high for a longer period of time.

3.          ECBThere is a clear division among officials, and after inflation has fallen, the European Central Bank is more willing to convey hawkish tendencies. The European Central Bank has violated market expectations in the past and will continue to emphasize its credibility in fighting inflation in order to regain its credibility.

Regardless of the resolution, ECB President Lagarde needs to firmly expressECBThe commitment to achieving inflation targets and stating that interest rate cuts remain a distant prospect. This is a difficult decision, but to convey this message, action speaks louder than words.

Disclaimers

The comments, news, research, analysis, pricing, and other information contained in this article can only be considered as general market information and are provided solely to assist readers in understanding the market situation and do not constitute investment advice.Ultima MarketsReasonable measures have been taken to ensure the accuracy of the data, but the accuracy of the data cannot be guaranteed and can be changed at any time without notice.Ultima MarketsWe will not be responsible for any losses or losses (including but not limited to any loss of profits) that may arise from the direct or indirect use or reliance on such information.