- When we look at wage data right now, it's not declining
- We will have a lot more data in 2024 and we need that to determine if declining inflation is sustainable
- We have to keep our guard up
- Decision on PEPP was shared by a "very, very large majority". Some would have liked a different taper, earlier or later
- We did not discuss rate cuts at all
- We are at the medium-term target that we set for ourselves of reaching the 2% at the end of our projection. We are probably a bit severe with ourselves... we are going to look very carefully at the end of 2025, where we're at 2.1% right now... the projections we have now are conditions on data from Nov 23
- We will be looking at our three criteria in the months ahead
- there are signs of reduced profit margins suggesting that companies are finally absorbing the input and wage increases which would be good news going into 2024
Lagarde said that there's space between rate hikes and rate cuts. "You don't go from solid to gas without going through the liquid state." ... as any science teacher will tell you, that's not true. It's called sublimation.
So far she has declined to repeat that they won't cut in the first two quarters of 2024 and is instead deferring to data, including wage agreements.
