Timing is everything: Five questions for the ECB


The European Central Bank meets on Thursday, with markets eyeing any nudge towards an interest rate cut as inflation weakens.

The ECB, expected to hold rates at a record 4%, is navigating a tricky path between keeping rates high long enough to contain inflation while not cutting too late as price pressures ease quickly.

"ECB speakers, even if they are of different views on timing, have acknowledged that rate cuts are coming," said Morgan Stanley chief European economist Jens Eisenschmidt. "The March meeting will be the opportunity to change the language in the statement to signal this."

1/ Could the ECB change its communication?

The ECB has pushed back against rate cut talk and markets now expect 90 basis points (bps) of cuts this year, versus 150 bps at the start of 2024.

Still, easing is on the cards and traders want guidance on...

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