Central Bank Watch – Deluge of BOE, ECB and Fed Speakers including Powell and Bernanke

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    European Central Bank policymaker Knot said that rate hikes have started to have an effect, but more increases will be needed to contain inflation. He added that the 2.0% inflation goal could be reached in 2025.

    Fitch lowered the long-term rating of the European Financial Stability Facility to AA- from AA.

    The Italian Treasury may reduce its stake in BMPS.


    European Central Bank President Lagarde said in an interview with Nikkei that there is more ground to cover in the central bank’s fight against inflation while policymaker Schnabel also said that more has to be done to slow inflation.

    Bank of Japan Governor Ueda repeated that ETF purchases are part of large-scale easing and that there are no current problems with these purchases.


    There is a growing number of European Central Bank policymakers talking about the need for rate hikes to continue past the summer.

    The European Central Bank’s latest Consumer Expectations survey showed that one-year inflation expectations rose to 5.0% from 4.6% while three-year expectations increased to 2.9% from 2.4%.

    The Bank of England voted 7-2 to raise its base rate by 25 bps to 4.50%, as expected.


    Minneapolis Fed Pres. Kashkari speaking

    Inflation has come down but it is still above target
    Wage growth has softened somewhat
    Bank turmoil can be a source of slowing for the economy
    Wage growth deceleration is mixed depending on income
    Housing is a key issue for hiring new workers from other regions
    Feds 2% inflation target is permanent for the near future.
    It’s conceivable that once we get inflation down to 2% we could have a conversation about changing the target
    Fed is united in commitment to getting inflation to 2%
    Kashkari is a speaking at a Marquette CEO town Hall event
    I am not convinced we are at Max employment
    Inflation is too high
    If markets are right and that inflation will fall quickly, one would imagine rates could normalize
    If high inflation is a more embedded, rates will need to stay high for longer
    Data is driving my policy expectations
    I am now on the more hawkish and of Fed policy spectrum
    Not seeing evidence of a crash in consumer spending or slower in services side of economy
    Once this period of high inflation ends, we will be back in a low inflation, low rate environment
    Inflation is coming down, but it’s pretty darn persistent.
    That means we will have to keep at it for an extended period
    Inverted yield curve put real pressure on banks


    BOE’s Bailey Speaking in a Bloomberg interview after BOE raised rates

    We are approaching the point when we should be able to let level of rates rest
    We have not yet seen evidence that allows us to be sure rates can stay on hold

    Hike marks the 12th consecutive increase
    Bank Rate at highest level since 2008
    Bailey said BoE will “stay the course” on inflation
    Growth forecast received biggest upgrade since 1997
    BoE no longer predicts a recession
    Inflation expected to fall more slowly than previously anticipated, mainly due to persistent food price increases
    Policymakers voted 7-2 for May’s increase, in line with economists’ expectations
    Investors pricing in a peak of almost 5% by autumn
    BoE predicts inflation will not return to its 2% target until early 2025

    Bank of England Raises Interest Rates 25bps to 4.50%, Inflation Remains Too High

    • This reply was modified 2 weeks, 2 days ago by TradersCom.
    Helmholtz Watson

    Three central bank decisions are on the books in the coming week. Most significant is the PBoC’s 1-year Medium-Term Lending Facility Rate at the start
    [See the full post at: Central Bank Watch – Deluge of BOE, ECB and Fed Speakers including Powell and Bernanke]

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