Lagarde defends June rate hike as core inflation and supply shock persist
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Lagarde's insistence that the June hike remains appropriate even under a more favourable Middle East scenario signals the ECB is prioritising underlying inflation persistence over a peace dividend from the Iran ceasefire, limiting scope for near-term dovish repricing. The modest
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4 itemsLagarde flags ECB inflation forecast revision ahead of June 11 rate decision
Christine Lagarde, Luis de Guindos: Monetary policy statement (with Q&A)
The ECB's recent monetary policy statement highlights a cautious stance amidst rising inflation and geopolitical tensions. Per the full note [source], President Lagarde emphasized the need for a data-driven approach as inflation surged to 3.0% in April, driven primarily by energy prices linked to the ongoing conflict in the Middle East. The desk interprets this as a signal for potential volatility in the eurozone, particularly as the ECB remains non-committal on future rate paths. With the upcoming CPI and inflation rate data on June 2, traders should prepare for possible market reactions based on these indicators.