EUR Dips After ECB Leaves Rates Unch As Expected
Hot on the heels of ECB President Lagarde's statement about early retirement, The European Central Bank kept interest rates unchanged as was fully expected.
The deposit rate was left at 2.5%, as predicted by almost all economists surveyed by Bloomberg.
On borrowing costs, the ECB is biding its time having hiked twice since the Iran war jolted energy markets. Officials, while worried inflation is headed for double the 2% goal, aren’t seeing signs of the ramp-up in oil and gas spreading elsewhere. Still, surprisingly resilient European growth is waning.
EUR weakened modestly against the USD after the statement...
Finally, some have argued that Lagarde's early departure will give her more freedom to speak out on issues including the turmoil in her homeland.
The ECB joins the Fed in holding rates steady this week, with the BoJ expected to follow suit on Friday...
However, as Bloomberg reports, policymakers in Frankfurt are widely expected to hike again in December, when updated economic projections will show how severe inflation pressure is. Tighter financing conditions, exacerbated by France, are damping demand.
Analysts reckon the year-end increase in rates will be the ECB’s last of this cycle, though investors are betting on two more steps in 2027.
The latter group’s focus is on oil, which has jumped by more than 6% since the ECB last set rates. Natural gas, meanwhile, hit its highest level in almost four years.
Tyler Durden Thu, 10/29/2026 - 09:35
Continue reading...
[ H/T ZeroHedge ]
Hot on the heels of ECB President Lagarde's statement about early retirement, The European Central Bank kept interest rates unchanged as was fully expected.
The deposit rate was left at 2.5%, as predicted by almost all economists surveyed by Bloomberg.
On borrowing costs, the ECB is biding its time having hiked twice since the Iran war jolted energy markets. Officials, while worried inflation is headed for double the 2% goal, aren’t seeing signs of the ramp-up in oil and gas spreading elsewhere. Still, surprisingly resilient European growth is waning.
EUR weakened modestly against the USD after the statement...
Finally, some have argued that Lagarde's early departure will give her more freedom to speak out on issues including the turmoil in her homeland.
The ECB joins the Fed in holding rates steady this week, with the BoJ expected to follow suit on Friday...
However, as Bloomberg reports, policymakers in Frankfurt are widely expected to hike again in December, when updated economic projections will show how severe inflation pressure is. Tighter financing conditions, exacerbated by France, are damping demand.
Analysts reckon the year-end increase in rates will be the ECB’s last of this cycle, though investors are betting on two more steps in 2027.
The latter group’s focus is on oil, which has jumped by more than 6% since the ECB last set rates. Natural gas, meanwhile, hit its highest level in almost four years.
Tyler Durden Thu, 10/29/2026 - 09:35
Continue reading...
[ H/T ZeroHedge ]
