- Inflation has converged toward 2% for six projections in a row, at some point in the course of 2025
- Past shocks have pushed inflation down
- Productivity we are seeing more-promising signs
- We have not discussed neutral rate level in meeting
- I don’t think about market pricing of rate hikes
- Risk to inflation is now two-sided
- The direction of travel (on rates) is currently clear, the pace is uncertain
- A lot of ground has been covered, we have already cut by 100 bps
- Tariffs are not incorporated into ECB projections
- Variations in the exchange rate have an impact on inflation and we will be attentive to that
- We will debate neutral rate in due course
There wasn’t much here to mull, the market is full priced for another 25 bps in January.
This article was written by Adam Button at www.forexlive.com. Source