Published on November 15, 2022 Last week the European Central Bank continued with its negative inflation forecast, a reflection that its president Christine Lagarde already began on November 4. In addition, the most ‘aggressive’ members, who normally remain moderate, seem alarmed by the inflation data. The key message on which the speech is reinforced is that the ECB will take rates into restrictive territory at a rate of 3%. The European Commission announced on Friday in its autumn economic forecasts that the EU as a whole will enter a recession in the fourth quarter, coinciding with the IMF’s Regional Economic Outlook report on Europe. The ECB faces the prospect of intensifying its rate hike to control inflation (to 10.7%) just as the economy enters recession. This week several members of the ECB will appear, of all colors, Lagarde, for her part, will be at the European Banking Congress on Friday, a place where at other times the presidents of the ECB have been very forceful in their statements. Regarding inflation in the Eurozone, there was a small downward revision, which was entirely driven by a 70 bps revision in Italy, where energy bills for the protected market were updated during the month. With the change in the reading of gas rates and their reviews, which used to be quarterly and are now monthly, consumers pay their bills in advance, leading them to face a significant increase in prices in October. Therefore, the statistical agency of the transalpine country has to decide whether to capture the change in energy prices only in November, leaving the preliminary impression of October unchanged. INFORMATIONTitleContinuation of the hawkish speech at the ECBDescriptionLast week the European Central Bank continued with its negative forecast on inflation, a reflection that its president Christine Lagarde already began on November 4. Author GLOBALCAJA
Continuation of the hawkish speech at the ECB
