- No signs of deflationary spiral in euro area
- Bundesbank expects inflation to slowly approach 2.0%
- Europe is halfway through euro crisis ( is that ‘cup half full’ or ‘half empty’ type halfway?)
- Negative deposit rate could help revive lending
- ECB June action depends on medium term inflation outlook
- Central bankers look at rates first for action
- Recommends calmness on euro discussion
- Didn’t change position on government bond purchases
- Central banks in euro area must not finance states
- Not in favour of targeted exchange rate policy to weaken the euro
- ECB would not be able to conduct independent monetary policy if an exchange rate target was introduced ( I wonder if another state has suggested such a thing…looking at you France)
EUR/USD gets excited and jumps 15 pips to 1.3670 as Bundesbank head and ECB man gives an interview with Sueddeutsche Zeitung.
From the little clues there it sounds like they are still undecided on the effects of negative rates and that could mean they are not quite on the agenda, though the refi rate seems firmly on the table. What is clear is that the ECB is going to be deciding policy on economic projections and I for one don’t hold them any higher than bank calls and forecasts. We’re at the mercy of the ECB beavers in their forecasting hidey holes.
