ECB's Cipollone
ECB's Cipollone

ECB Cipollone is speaking and says:

  • We see some signs of economic recovery citing PMI data.
  • Expects for rest of year inflation at this level more or less.
  • Base effects are due to unwinding of cost-of-living measures.
  • We expect inflation resuming path to 2% next year, at target by mid-2025.
  • If incoming data in June and July confirm that confidence it will be appropriate to remove some restrictive measures imposed in 2023.
  • Middle East conflict's impact on energy costs is a major risk.
  • As recovery unfolds we expect productivity to go up.

Comments are little more hawkish than most (or at least more cautious due to the risks. No mentions of cutting rates in June or soon.

Looking at the recent PMI data released earlier this month, did show mostly improvement, but most levels in Europe are still below the 50 level.

  • Spanish Manufacturing PMI:

    • Actual: 51.4
    • Forecast: 51.1
    • Previous: 51.5
    • Outcome: Met forecast (nearly) but weaker than previous

  • Swiss Manufacturing PMI:

    • Actual: 45.2
    • Forecast: 45.0
    • Previous: 44.0
    • Outcome: Stronger than forecast and previous

  • Italian Final Manufacturing PMI:

    • Actual: 50.4
    • Forecast: 48.9
    • Previous: 48.7
    • Outcome: Stronger than forecast and previous

  • France Final Manufacturing PMI:

    • Actual: 46.2
    • Forecast: 45.8
    • Previous: 45.8
    • Outcome: Stronger than forecast but consistent with previous

  • Germany Final Manufacturing PMI:

    • Actual: 41.9
    • Forecast: 41.6
    • Previous: 41.6
    • Outcome: Stronger than forecast and previous

  • EU Final Manufacturing PMI:

    • Actual: 46.1
    • Forecast: 45.7
    • Previous: 45.7
    • Outcome: Stronger than forecast and previous

  • UK Final Manufacturing PMI:

    • Actual: 50.3
    • Forecast: 49.9
    • Previous: 49.9
    • Outcome: Stronger than forecast and previous