Lagarde ECB
  • We're not thinking about pausing
  • Are we done? No
  • We need to be confident that core inflation is heading down
  • We are not satisfied with the inflation outlook
  • I don't want to comment about the terminal rate. We will know when we get there
  • Unless there is a material change, we will hike in July
  • Very broad consensus behind decision
  • Under current parameters, 2.2% inflation in 2025 isn't satisfactory
  • The indirect cost of energy price rises will continue to fade
  • We decided to let APP move into a run-off mode

EUR/USD is near the post-statement highs but there's an element of USD-weakness at work as well. Last at 1.0873.

Update: The press conference is over. I don't know if we learned much here but a hike in July is only priced at 68% and that sounds too low to me. I'd comfortably pencil in two more hikes.