ECB to Refrain From Explicit Guidance at July Meeting -- Market Talk

The European Central Bank will likely avoid explicit guidance at its meeting next week, emphasizing that it is not on a pre-determined path, Deutsche Bank economists say in a note.

WSJJul 12 06:38 ET

ECB Preview: No Need for a Follow-up Cut yet – Rabobank

Some policymakers had initially left the door ajar to a follow-up cut in July. That door is now shut tight. Incoming data do not require urgent rate cuts; in fact, these data should urge further caution as economic growth and credit are picking up again, Rabobank’s senior macro strategist Bas van Geffen notes.

FXStreetJul 12 05:39 ET

ECB Might Cut Rates Only One More Time in 2024 -- Market Talk

The European Central Bank is expected to cut interest rates one more time this year, in September, followed by four more cuts in 2025, Allianz Research analysts say in a note. "After September, we expect the ECB to remain on hold as base effects will become unfavorable again, raising public opinion pressure," they say. Also, the risk of an increasing transatlantic policy divergence will force the ECB to postpone the easing cycle until the Federal Reserve follows suit, they say. With five more cuts in total, Allianz Research sees the ECB's terminal deposit rate at 2.50%, adding that it assumes a real neutral rate of around 0.5%. The ECB cut rates by 25 basis points in June.

WSJJul 12 05:26 ET

Highly Likely ECB Rate Cut in September Points to Slightly Lower Bund Yield -- Market Talk

The growing momentum for an interest-rate cut by the European Central Bank in September leaves rates strategists at Citi Research with a "mild bullish lean" for German Bunds, targeting a grind in 10-year yields toward 2.25%, they say. The market will likely maintain a very high probability for a September ECB rate cut even without new signal at next Thursday's meeting, the strategists say in a note. The latest soft U.S. CPI provides extra cover to cut, while there is also anyway a strong case for a near unconditional second reduction, they say. "Even if genuinely conditional, incoming HICP data is likely to cement an ongoing cycle, in our view," they add. The 10-year Bund yield trades 4 basis points higher at 2.482%, according to Tradeweb.

WSJJul 12 03:29 ET

Political risk lingers, and the European Central Bank's decision to cut interest rates again in September is becoming a consensus.

According to a survey of analysts, as political turmoil creates a series of risks for inflation to return to 2%, the European Central Bank will take a cautious approach to lowering interest rates. After the first 25 basis point cut in June, respondents expected officials to pause rate cuts at next week's meeting. It is expected to resume rate cuts in September, once per quarter, until deposit rates are lowered to 2.5% in a year. The gradual reversal of unprecedented monetary tightening policy reflects the increasing difficulty of evaluating the economic traps of the 20 countries in the euro area. Inflation pressures remain strong, but the momentum of the recovery from months of stagnation may have already been revealed.

Zhitong FinanceJul 12 03:21 ET

ECB Meeting Expected to Pave the Way to Next Rate Cut in September -- Market Talk

The European Central Bank's meeting on July 18 is expected to serve mainly to pave the way for another interest-rate cut in September, rates strategists at Societe Generale Research say in a note. The ECB delivered a 25 basis point rate reduction in June and emphasized data dependence regarding further steps.

WSJJul 12 02:34 ET