In order to pave the way for another refinancing rate hike in March, the ECB would need to signal that another move was on its way in one of the next two press conferences. We, therefore, shall be all ears Thursday.
You could argue that he downplayed the weakness in the recent data. But the forward-looking indicators suggest that this was just a bump in the road.
We should be asking ourselves, why we don't create jobs in Germany.
The way the data are shaping up, they might consider slightly speeding up the pace of tightening. The situation today is different than in December.
A move up to 3.25 percent is not yet fully priced into the market. While our official call remains for a 3.25 percent level being reached in December, the balance of risks, in our mind, suggests that this level could be reached earlier.
As long as the data point to an ongoing economic recovery, they should feel comfortable about normalizing rates. If anything, the survey numbers are more robust than before.
With those few, clear words, the May rate hike is off the table, and I'm not even sure about June. I think it was very disappointing.
Over all, the change in the oil price has to affect the inflation outlook and the case for rate increases. The next round of projections are likely to be uncomfortable for any central banker.
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