- Some governors would have preferred to pause and wait on more data
- A ‘solid majority’ agreed with the decision
- Three quarters of the rise in the 2024 rise in inflation is due to carry-over from 2023
- We didn’t discuss how long we will leave rates at these levels, we will continue to be data dependent
- We are not saying that we’re now at the peak, we can’t say that now
- The focus is expected to move towards duration
- Policy transmission is faster than previous cycles
- We are going through a phase of very sluggish growth
- We see weak signs
The market is pricing only a 10-15% chance of a further ECB hikes, with cuts more likely starting in March.
There was some euro buying when Lagarde said that they couldn’t say rates had peaked but the gains quickly backed off.