ECB's Lagarde: We view a 'measured response' as appropriate to keep inflation in check
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Growth has been broad-based across most countries and sectors, we expect this to continue Manufacturing is performing solidly The labor market remains robust The outlook continues to be highly uncertain Major tech advancements have not reduced unemployment but the verdict is stil
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The ECB's current stance reflects a cautious approach amid mixed inflation signals, with President Lagarde emphasizing that the eurozone's inflation metrics remain around the target of 2%. Per the full note [source], while short-term inflation expectations are rising, easing labor costs suggest that the ECB has room to maintain rates without immediate hikes. This nuanced positioning is critical as the market anticipates potential shifts in policy, particularly with a June hike currently priced at 76%. The desk believes that the ECB's wait-and-see approach will be pivotal in shaping the euro's trajectory in the coming weeks.
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