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Exclusive: ECB’s Holzmann: If Things Stay Unchanged Between Now and Dec 15, I Would Go for 75BP

- Holzmann: ‘If things remain unchanged from now to the decision, then I would go for 75’ bp
- Holzmann: If there were a ‘major reduction’ in HICP this month, ‘I could go along with 50’ bp
- Holzmann: No ‘major recession’ seen for now
- Holzmann: On QT, see ‘‘strong consensus that we should start small to test the markets’
- Holzmann: QT should start with APP, only involve PEPP ‘much later’
- Holzmann: Roll-off of assets acquired under the APP can overlap with rate hikes
- Holzmann: ‘Still very much concerned that a de-anchoring of inflation expectations will take place’
- Holzmann: Recent German wage agreement ‘acceptable’, but may lead companies to increase prices

21 November 2022 Central Bank News

ECB Insight: Knot, Dialling Rate Hike Rhetoric down a Notch, Borrows a QT Page from Villeroy

By David Barwick – FRANKFURT (Econostream) – European Central Bank Governing Council member Klaas Knot’s comments on Friday suggest that he may be backing down from his earlier enthusiasm for the possibility of a renewed 75bp rate hike in December.

21 November 2022 Central Bank News

ECB Insight: Council Members’ Comments Suggest a Cautious Start to QT Start Doable in 1Q

By David Barwick – FRANKFURT (Econostream) – As the public discussion of the European Central Bank’s approach to quantitative tightening heats up, one can venture some guesses about what will materialise, based on Governing Council members’ contributions to that discussion.

21 November 2022 Central Bank News

They Said It: Recent ECB Policymaker Comments on Quantitative Tightening

By David Barwick – FRANKFURT (Econostream) – To the reasonably complete compendium published here last Thursday of recent public comments by European Central Bank Governing Council members touching on the subject of quantitative tightening, we have added remarks made on Friday.

21 November 2022 Central Bank News

ECB’s Vasle: Must Continue Normalising Monetary Policy; Rates to Become Restrictive

By David Barwick – FRANKFURT (Econostream) – European Central Bank Governing Council member Boštjan Vasle on Monday said that the ECB had to keep normalising monetary policy and that interest rates would be hiked to the point of being restrictive.

21 November 2022 Central Bank News

ECB’s Knot: ‘We Have to Hang in There for Quite a Long Time’

By David Barwick – FRANKFURT (Econostream) – European Central Bank Governing Council member Klaas Knot on Friday said that the terminal rate of the current ECB hiking cycle could not be known under the current circumstances, but that monetary authorities still had much to do.

18 November 2022 Central Bank News

ECB’s Knot: Policy Must Turn Restrictive; Should ‘Test the Waters’ with QT Before Deciding Ultimate Pace

By David Barwick – FRANKFURT (Econostream) – European Central Bank Governing Council member Klaas Knot on Friday said that ECB monetary policy had to become restrictive in order to slow demand and called for quantitative tightening to start early but be cautious.

18 November 2022 Central Bank News

ECB Insight: Nagel, Though Hawkish as Usual, Sticks to the Beaten Path

By David Barwick – FRANKFURT (Econostream) – The speech made Friday afternoon by European Central Bank Governing Council member Joachim Nagel ultimately offered little to guide ECB watchers.

18 November 2022 Central Bank News

ECB’s Nagel: Need Further Decisive Steps; Mustn’t Be Lulled Too Quickly into Letting up

By David Barwick – FRANKFURT (Econostream) – European Central Bank Governing Council member Joachim Nagel on Friday called for additional decisive monetary policy action, saying that initial unclear indications of lower price pressures shouldn’t lull the ECB into relaxing.

18 November 2022 Central Bank News

ECB Insight: Lagarde Excludes Full-Bore Approach to QT, Stressing Primacy of Interest Rates

By David Barwick – FRANKFURT (Econostream) – Comments made by European Central Bank President Christine Lagarde on Friday effectively excluded a full-throated initial approach to unwinding the ECB’s balance sheet.

18 November 2022 Central Bank News

ECB’s Lagarde: Appropriate to Normalise Balance Sheet in Measured, Predictable Way

By David Barwick – FRANKFURT (Econostream) – European Central Bank President Christine Lagarde on Friday indicated that normalisation of the ECB’s balance sheet would take place cautiously and gradually, and would be subordinate to interest rates in determining the stance of monetary policy.

18 November 2022 Central Bank News

ECB’s Lane: Would Be a Major Failure by Us if Households Expected Inflation to Remain High

By David Barwick – FRANKFURT (Econostream) – The European Central Bank will have failed in a big way if consumers saw inflation staying as elevated as it is now, ECB Chief Economist Philip Lane said Thursday.

17 November 2022 Central Bank News

ECB’s Villeroy: Rise in the Dollar Has Tended to Be Interrupted Recently

By David Barwick – FRANKFURT (Econostream) – European Central Bank Governing Council member François Villeroy de Galhau on Thursday noted the recent failure of the dollar to continue strengthening.

17 November 2022 Central Bank News

They Said It: Recent ECB Policymaker Comments on Quantitative Tightening

By David Barwick – FRANKFURT (Econostream) – We have assembled below a reasonably complete compendium of all recent public comments by European Central Bank Governing Council members touching on the subject of quantitative tightening, favouring direct quotes where possible.

17 November 2022 Central Bank News

ECB’s Rehn: Anchoring Expectations Absolutely Essential; Hike Likely in December

By David Barwick – FRANKFURT (Econostream) – It is critical that the European Central Bank keep inflation expectations under control, ECB Governing Council member Olli Rehn said on Thursday.

17 November 2022 Central Bank News

ECB: Euro Area Financial Stability Conditions Have Worsened; Likelihood of Recession Up Markedly

By David Barwick – FRANKFURT (Econostream) – The financial stability situation of the euro area has worsened again, the European Central Bank said on Wednesday.

16 November 2022 Central Bank News

ECB’s Villeroy: After December, May Raise Rates in More Flexible, Possibly Less Rapid Manner

By David Barwick – FRANKFURT (Econostream) – European Central Bank Governing Council member François Villeroy de Galhau on Wednesday repeated his assertion that the ECB could potentially slow the pace of policy tightening after reaching a normalisation range in December.

16 November 2022 Central Bank News

ECB’s Makhlouf: Slowdown in Growth Won’t by Itself Ensure a Return to Price Stability

By David Barwick – FRANKFURT (Econostream) – European Central Bank Governing Council member Gabriel Makhlouf on Wednesday said that slower economic growth by itself would not be sufficient to restore euro area price stability.

16 November 2022 Central Bank News

ECB’s de Cos: Should Run off APP Portfolio Ony After Sufficient TLTRO Funds Have Been Repaid

By David Barwick – FRANKFURT (Econostream) – The European Central Bank should start running off the bonds acquired under QE only after markets have absorbed significant TLTRO repayments, Governing Council member Pablo Hernández de Cos said Wednesday.

16 November 2022 Central Bank News

ECB’s Visco Urges – Again – That Rate Moves Consider Worsening Economy and Growing Stability Risks

By David Barwick – FRANKFURT (Econostream) – The European Central Bank still needs to hike rates, but there are reasons to think that it can do so at a slower pace than to date, ECB Governing Council member Ignazio Visco said Wednesday.

16 November 2022 Central Bank News