While the European Central Bank kept interest rates on hold at today’s meeting, ECB president Christine Lagarde’s comments at the press conference suggest that a June hike has come closer.
Unless there is a quick end to the war in the Middle East, headline inflation continues to increase, and knock-on effects on transportation, food prices, and other parts of the supply chain continue, the ECB is clearly moving towards a rate hike in June.
All in all, the main takeaway from today’s ECB meeting can probably be described as another hawkish shift, introducing a clear hiking bias to its wait-and-see stance.
As stagflationary pressures in the eurozone increase, the ECB has decided to keep interest rates on hold. In its policy statement, the ECB acknowledged rising inflationary pressures but also more
