European Central Bank officials, speaking at various forums including GMF, CNBC, and to financial news outlets like FT and BBG, have indicated a resistance to early interest rate cuts, despite market optimism. ECB's Centeno confirmed that recent data aligns with December projections but noted that inflation was slightly below forecast. He expects contained wage demands and describes the inflation trajectory as very positive. ECB officials, including Centeno, Knot, and Simkus, have emphasized the importance of not undershooting the 2% inflation target and have suggested that any easing of rates would be very gradual. Knot also mentioned that the labor market remains tight and highlighted Middle East tensions as a risk. While markets anticipate rate cuts, with some expectations pointing towards the summer, ECB officials have warned that premature bets on rate cuts could be self-defeating. They argue that easing market expectations could decrease the likelihood of actual rate cuts. ECB's Vasle commented on the robustness of the labor market, while Villeroy noted that economic uncertainty in France is dissipating, yet the job of monetary policy is not yet finished, indicating it is premature to predict rate cuts in 2024.
ECB officials who’d been reluctant to discuss the possibility of interest-rate cuts until recently now appear increasingly open to a first such move, with President Christine Lagarde saying one is likely in the summer. https://t.co/DP4O5bXSx9
ECB officials converge around June to start cutting rates https://t.co/W9x42CGjJi via @weberalexander https://t.co/T7WqdSGrfx
ECB officials who until recently had been wary of even discussing interest-rate cuts now look increasingly open to commencing them in June https://t.co/m1OmmAWpbf
ECB Officials Converge Around June To Start Cutting Rates - BBG https://t.co/VMEIv5G2uO
ECB Officials Converge Around June to Start Cutting Rates https://t.co/09mXPKfFMb
Expectations of ECB interest rate cut in Q2 grow stronger - Reuters poll https://t.co/Ykrxhqbc3z https://t.co/c0aKRdDXBl
🔴 ECONOMISTS: LARGER ECB RATE CUTS MORE LIKELY THAN SMALLER
ECB’s Vasle calls spring rate-cut bets ‘absolutely premature’ https://t.co/Aman0W39fA via @atimu2 https://t.co/jzUA1urAKF
Lagarde Says It’s Likely @ECB Will Cut Rates in Summer https://t.co/WvrPle5fzl
ECB's Knot pushes back on rate cut bets https://t.co/QcPR12rxPF https://t.co/pNHFdEuhqk
Villeroy says it is premature to know when in 2024 the ECB will cut rates https://t.co/Oe8Z9I9G7R via @WHorobin https://t.co/0EHG4fsojY
ECB’s Villeroy: Economic Uncertainty Is Dissipating In France - Job Of Monetary Policy Isn’t Done Yet
🔴 ECB'S VILLEROY: JOB OF MONETARY POLICY ISN'T FINISHED YET.
⚠️ ECB'S KNOT PUSHES BACK ON RATE CUT BETS (Reuters) Investor bets for European Central Bank rate cuts are excessive and possibly self defeating because they could actually hold back monetary easing, Dutch central bank chief Klaas Knot told CNBC on Wednesday. Markets are… https://t.co/sddX3AIing
🔴 ECB'S VASLE: THE LABOR MARKETS IS STILL ROBUST, BUT NEED CAUTION ON WAGES.
Markets getting ahead of themselves on rate cuts and risk being 'self-defeating,' ECB member says https://t.co/uLKTCYKmaG
ECB’s Knot: More Easing Market Does, Less Likely We’ll Cut
🔴 ECB'S KNOT: THE MORE EASING THE MARKET DOES, THE LESS LIKELY WE'LL CUT.
🔴 ECB'S KNOT: A RATE HIKE IN FIRST HALF RATHER IS UNLIKELY - CNBC.
🔴 ECB'S KNOT: WE NEED TO SEE A TURNAROUND IN WAGES.
🔴 ECB'S KNOT: EASING, IF IT HAPPENS, IT WILL BE VERY GRADUAL.
ECB’s Knot: Rate Hike In The First Half Rather Unlikely - CNBC
ECB’s Knot: Labour Market Is Still Very Tight - Middle East Tensions Are Also A Risk - Easing If It Happens Will Be Very Gradual - We Need To See A Turn Around In Wages
🔴 ECB'S KNOT: MARKETS ARE GETTING AHEAD OF THEMSELVES ON CUTS. A LOT MUST GO WELL TO HIT 2% INFLATION IN 2025.
ECB Simkus: ‘Far Less Optimistic’ Than Markets On Rate Cuts - Interest Rate Cuts May Begin Around Summer
ECB Mustn’t Undershoot Its 2% Inflation Target, Centeno Warns - BBG https://t.co/ClN7rZKKBb
🔴 ECB'S CENTENO: I DON’T SEE REASONS FOR CONCERN OVER WAGES.
🔴 ECB'S CENTENO: IT IS DIFFICULT TO GAUGE TIGHTNESS OF EURO-AREA LABOR MARKET.
ECB Resists Spring Interest Rate Cut As Price Expectations Ease - FT https://t.co/WV1HwYCeDd
ECB resists spring interest rate cut as price expectations ease https://t.co/eN11HEgnMw
Like their Fed peers, ECB officials challenge the market’s rate-cut optimism writes @JamieCMarkets https://t.co/QFv5nGPXvM
Like their Fed peers, ECB officials challenge the market’s rate-cut optimism https://t.co/iFNGfm4G3L
ECB’s Centeno To GMF: Expects Contained Wage Demands - CNBC - Inflation Trajectory Is Very Positive Right Now
ECB’s Centeno To GMF: Recent Data Have Confirmed Dec Projections But Inflation Was Slightly Below Forecast