ECB 6 March Council Preview
NO RATE MOVE EXPECTED 6 MARCH: ECB SEEN LIKELY TO REMAIN IN NEUTRAL THROUGH INTO 2nd HALF OF 2008, WITH POSSIBLE 25 bp CUT NEAR END-2008.
· Weaker activity in 2007 Q4 confirmed, with quarterly GDP growth down from 0.8% to 0.4%, slightly below 0.5% trend rate.
· Inflation risks remain clearly on the upside with 3.2% 'headline' rate again in February, with external cost pressures and domestic pass-through effects persisting.
· Money and credit growth still rapid and liquidity overhang widens further.
· ECB seen in neutral mode, monitoring how wage negotiations and developments in financial markets, the US economy and global growth play out.
· No early rate cut expected: likely to remain on hold well into second half of 2008.
© Graham Bishop
Documents associated with this article
|
EZA833.pdf
|
Key
Hover over the blue highlighted
text to view the acronym meaning
Hover
over these icons for more information
Comments:
No Comments for this Article