Home » inflation falling but it’s not enough for us. Cuts? More data in June From Investing.com

inflation falling but it’s not enough for us. Cuts? More data in June From Investing.com

by admin
inflation falling but it’s not enough for us.  Cuts?  More data in June From Investing.com

© Reuters

Investing.com – After the latest downward inflation revision, “we are more confident, but not yet enough” to cut interest rates. This is the gist of ECB President Christine Lagarde’s speech.

In the conference following the Frankfurt meeting, in which the European Central Bank decided to leave rates unchanged, the French banker underlined how the ECB continues to be dependent on data in its moves and whether new ones can already be evaluated in April , June will be the month in which “more will arrive”.

In particular, the Governing Council is keeping an eye on data from the labor market.

“Although most inflation indicators have slowed further, domestic inflationary pressures remain, especially wage growth,” Lagarde stressed before reiterating: “We did not discuss rate cuts in this meeting. We need a lot more information which will come in small part in April, but we will have a lot more in June.”

However, the number one on the board admitted that, even if the decision to keep rates unchanged was taken unanimously, “the Board has started to discuss a reduction in the restrictive stance”, in case more evidence arrives on the cooling of the economy. And in any case the ECB will not wait for inflation to return to 2% to begin to loosen its grip.

In short, if everything goes as it should, the date for the first rate cut is set for June.

Inflation and growth revised downwards

In the monetary policy statement, the ECB underlined how inflation has decreased further since its last meeting in January.

Experts now indicate that it would average 2.3% in 2024 (from 2.7% previously), 2% in 2025 (from 2.1%) and 1.9% in 2026. Even the inflation excluding energy and food was adjusted downwards, to an average of 2.6% in 2024, 2.1% in 2025 and 2% in 2026.

See also  Alfredo Pacheco's son dies in a shooting in Houston, Texas - Listin Diario

However, “domestic price pressures remain high also due to strong wage growth”.

But the ECB also revised its growth projection for 2024 downwards to 0.6% (from the 0.8% forecast in December). Economic activity is expected to remain moderate in the short term, and then grow by 1.5% in 2025 and 1.6% in 2026, supported initially by consumption and later also by investments.


Take advantage of a special discount for subscribing to InvestingPro and take advantage of all our tools to optimize your investment strategy. (The link calculates and directly applies the additional discount dedicated to you. If the page does not load, enter the code PRO124 to activate the offer).

Pro Information

Are you interested in cryptocurrencies? Then take advantage of the Investing.com Academy to delve deeper into the world of e altcoins: find out how it works cryptocurrency taxation in Italy, or learn more about the current phenomenon by reading an article that explains what crypto ETFs are.

Follow her monthly overview of the main indices stocks, above all, S&P 500 and with the contribution of Calogero Selvaggioanalyst and part of the Investing.com Italy Team.

Sign up for the next webinar for free of March 11th “First steps in technical analysis: the trading diary” a THIS LINK. Plus, learn how to Beat the S&P 500 with AI-picked stocks with our latest ProPicks tool.

If you want to understand how to best use InvestingPro’s Fair Value and Propicks watch the video by clicking on THIS LINK.

You may also like

Leave a Comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Accept Read More

Privacy & Cookies Policy