Fecha Actual:June 6, 2023

Markets brace for ECB announcements.

This Thursday the European Central Bank will execute its declaration of monetary policy and will hold a press conference. High impact market opening is expected.

Amid incipient concerns about new cases of COVID contagion by the new DELTA variant, and the effects that this could have on the markets, expectations are placed in the next announcement.

The impact of the announcements will revolve around the mode and forecasts of change in the current measures as no major changes are projected. In a direction contrary to what many of the most important central banks seem to be going, the ECB, would maintain a certain symmetry with the Fed in sustaining the asset purchase programs.

These intentions were evidenced by the results of the strategic review carried out by the ECB. The projection for changes in interest rate policy was a CPI close to and sustainable at 2%. However, this changed with the last revision, where a CPI is projected around a “symmetric 2%” and, it is probable that, although seasonally, it will exceed this level. Above all, considering that the price of houses has been included for the calculation of the Harmonized Index of Consumer Prices. The last reference to the CPI is the one published in the last week, with a level of 1.9%.

In the latest announcements by the ECB, through its President C. Lagarde, it is resolved that the 2% goal is not a ceiling and that it is a symmetrical goal, taking action on excesses such as low inflationary levels.

Even so, deadlines are expected to be identified for changes in PEPP’s purchasing policy, which will probably remain unchanged at 1.85 billion euros.

The EURUSD, after a low start to the day, the cross opened at 1,777 and closed buy at 1,788.

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