ECB Meeting: Five Key Questions on Rates, Inflation and Lagarde's Exit
- The European Central Bank meets on Thursday amid energy-driven inflation risks, with analysts widely anticipating the institution will keep its key interest rate unchanged at 2.5%.
- Upheaval in France and an Iran war keeping energy prices above $100 have complicated the economic landscape, as inflation reached 3.8% in September and oil prices surged 90% this year.
- French 10-year borrowing costs recently hit highs above 5%, though ECB President Christine Lagarde indicated the central bank would likely use its Transmission Protection Instrument to shield other countries, not France, from potential contagion.
- Economists polled by Reuters expect a quarter-point rate hike in December, though Barclays' head of euro rates strategy Rohan Khanna warned of "plenty of uncertainty around the conflict and the outlook for energy prices."
- Former central bank governors Klaas Knot and Pablo Hernandez are seen as frontrunners to replace Lagarde, who could become the next World Economic Forum chair as early as November.
73 Articles
73 Articles
The ECB has to deal with issues in the interest rate decision that require countermeasures.Inflation is rising, France is in need. Analysts fear a "communicative nightmare".
Will France’s Debt Crisis Stop the ECB From Raising Interest Rates Again?
The European Central Bank (ECB) faces a difficult balancing act as it prepares to announce its latest interest rate decision, with rising energy prices pushing inflation concerns higher while France’s worsening debt crisis threatens to tighten financial conditions across the euro zone. The ECB is widely expected to leave interest rates unchanged on Thursday. However, […]
Deposit rate should remain at 2.5%. Interest on French debt exceeded 5% for the first time since 2002 and the risk premium reached a maximum of 2011.
ANALYSIS - The two central banks should leave their rates unchanged this week, without excluding further increases in December. In Europe, the lack of confidence in French debt complicates the fight against inflation.
Interest remains high and inflation is still worrying central banks. This week, there are important decisions in the United States and Europe. Will interest stay the same or can it increase even more? Learn more, in this episode of the Economy day by day, daily podcast of the Express
Analysts consider that a rise in rates this week would be a big surprise. “Probability is practically zero,” they added.
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