Presiding over her first meeting of the European Central Bank on Thursday, Chris...
FRANKFURT - Presiding over her first meeting of the European Central Bank on Thursday, Christine Lagarde is all but certain to keep money taps wide open and may provide fresh clues about a broader policy revamp that could become the cornerstone of her tenure.
The review, due to start early next year and mirror a similar endeavor under way in the United States, comes as monetary policy is on auto pilot and financial markets are sanguine, allowing policymakers on both sides of the Atlantic to contemplate longer-term issues. “We see no reason for the ECB to adjust its guidance, let alone policy, beyond tweaking its near-term forecasts,” Florian Hense at Berenberg said. “We expect the ECB to keep its stance unchanged in 2020 while it reviews its strategy.”Lagarde’s predecessor could only have dreamt of such a placid start. Mario Draghi cut rates just three days into his term as ECB president, then spent the next half-decade fighting a debt crisis.
The first issue is whether she is fully committed to the Draghi package. While she has briefly confirmed the ECB’s policy stance, it remains to be seen whether she stands 100% behind the measures. “The scope of the strategy review may not be finalised before early 2020, but it should be centered on four main issues: the definition of price stability and the inflation measures; the side-effects of unconventional policy measures; the internal and external communication strategy; climate risks,” said Frederik Ducrozet at Pictet Wealth Management.
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Lagarde’s first ECB meeting is coming — here’s what to expectEven without interest-rate changes, the first meeting of the Christine Lagarde era will be closely watched for clues as to how it will differ from that of...
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Lagarde’s first ECB meeting is coming — here’s what to expectEven without interest-rate changes, the first meeting of the Christine Lagarde era will be closely watched for clues as to how it will differ from that of...
Consulte Mais informação »