ECB’s Lagarde: Recent data points to some improvement in economic activity.
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The EURUSD is trading at 1.1379 at the start of the press conference.
Lagarde's prepared comments:
- Recent data points to some improvement in economic activity.
- Activity and services partly recovered.
- Digital services robust, partly on AI.
- Firms, households expected labor market to remain weaker than before conflict.
- Indicators suggest economic activity remain modest
- Will said monetary policy to ensure inflation returns to target in medium-term.
- Inflation outlook and risks will be key to setting rates.
- Hello for energy prices while volatile are close to June projections, but uncertainty remains high
- Inflation declined to 2.8% in June
- Energy shock feeding into higher prices.
- Underlying inflation contained, full effect of energy shock has yet to play out
- Wage expectations continue to indicate moderate wage growth.
- Most measures of long-term inflation expectations stand around 2%.
- Energy inflation likely to keep inflation well above target into first half of 2027, but expect inflation will then decline as energy prices are expected to fall.
- Conflict remains a major source of uncertainty.
- Risks to growth tilted to the downside.
- Recent weeks have brought renewed setbacks.
- Energy prices could go up further and for longer than expectations.
- Higher energy prices will weigh on real incomes.
- Other geopolitical issues remain including Russia's conflict with Ukraine threatened growth
- Risks to inflation are to the upside.
- Energy shocks could intensify, potentially increasing broader inflationary moves and secondary effects.
- Extreme weather events, climate crisis could drive up food prices by more than expected.
- In contrast inflation can turn lower if the conflict is solved sustainably
- Overall financial conditions have become slightly tighter since the last meeting
Q&A
- Have had some relatively benign developments since June decision
- decision was unanimous.
- Some members stated question whether there should be a hike today but it was unanimous.
- We will receive a long list of fresh data before September meeting
- particularly attentive to any risk of a second round effects.
- Gradual decline in wages it is still happening.
- Says that she will stay on as he should be president as long as there are stormy clouds. "This captain is staying on the ship".
- Not giving any forward guidance but we have a framework
- Will assess the data and then make their decision in September.
- Most recent Houthi threats are alarming, will have an impact, but has not been factored into the decision today (that is a little micro isn't it?)
- The burden of proof is on data. It is as simple as that.
- The ECB is concerned about the potential direct and indirect effects. Reiterates that ECB does not see emergent second round effects yet.
The EURUSD is trading at 1.1378 at the end of the press conference virtually unchanged from the start of the press conference. Looking at the chart, the price is low for the day reached 1.1369 which was just above the swing level going back to July 1 at 1.13616. The EURUSD been mired in a narrow range between 1.13616 and 1.1482 since June 26. That is a narrow trading range. Sellers are testing the low extreme.
This article was written by Greg Michalowski at investinglive.com.提供 MainLink：Investinglive RSS Breaking News Feed
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