ECB’s Holzmann: August inflation data a conundrum for the ECB

  • Data shows that inflation is still persistent
  • We are not yet at the highest level for rates
  • Another one or two rate hikes is still possible

There’s no uniform message from the ECB as of late and this latest round of remarks by Holzmann is but another testament to that. They want to keep the door open to tighten further if need be but so far, they’re not managing that all too well. The odds of a 25 bps rate hike for next month are at ~28% now and as things stand, traders are not pricing in any more rate hikes by the ECB as the more favourable outcome.

This article was written by Justin Low at Source