Odds of an ECB rate cut are roughly 50/50 for the July meeting.
Economically, it’s a pretty easy decision. European is in the midst of a broad slowdown and the ECB would be cutting rates if it were not for one tiny problem: The lack of action from Euro area policymakers to get their proverbial act together. The ECB feels it has done more than its share to protect the European economy and wants the politicians to share the burden. German Bundesbank head Weidmann said so specifically today.
All things being equal, the ECB would cut. But things are far from equal in the ECB’s eyes. Especially the German eyes of the ECB.
