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ECB: Follows Guidance with 50bps Hike, Switches to Wait-and-See Stance
The ECB followed through on its long-communicated guidance with a 50bps hike today, but accompanied this with very limited signaling regarding the future policy path, against a backdrop of financial stability concerns. Had this meeting taken place just one week ago, the bank may have sounded a more hawkish note given today’s revision higher to its core inflation and GDP growth forecasts (table 1). table With the statement and Lagarde’s presser giving us little to go on in terms of what to expect at the May decision, we leave our forecast unchanged, seeing a 25bps hike at the May meeting. The EUR initially ... (full story)