ECB : a break for now

By Volker Schmidt: Portfolio Manager at Ethenea

At the beginning of July, ECB President Christine Lagarde made it clear at the central bank forum in Sintra, Portugal, that decisions on further interest rate cuts will be made depending on the respective data situation. The ECB's own quarterly calculations, which are published in March, June, September and December, play an important role here. In June 2024, the central bank slightly raised its own inflation forecast for 2024 and 2025 compared to the March forecast.

In line with the majority of investors, we do not expect an interest rate hike at the upcoming ECB meeting. As there is no ECB meeting in August, the second rate cut could then be decided at the September meeting. However, this is not certain; in particular, a worsening inflation forecast could prevent a rate cut. Is "Swift inflation", named after the American singer, also wreaking havoc in Europe? Christine Lagarde, too, confirms that major events this summer are fuelling inflation. In any case, the ECB's updated economic outlook will be presented again in September with the interest rate decision. We will then see whether the ECB also assigns a longer-term significance to this effect.

Volker Schmidt
Volker Schmidt

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Wim Heirbaut

Senior PR Consultant, Befirm

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About Ethenea

ETHENEA offers a wide range of attractive investment opportunities for different investor profiles: risk-minimised, balanced and equity-focused.

Capital preservation and the achievement of stable long-term returns are key components of the investment philosophy of the Ethna Funds. The fund management consistently realises this objective through active management and flexible asset allocation across various sectors and asset classes.

ETHENEA wants to make a contribution and offer responsible and sustainable investment solutions. Therefore, ESG criteria are an important part of the investment processes of all Ethna Funds (Article 8 SFDR).

Further information and legal information can be found at ethenea.com.

 

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