ECB's Signals for Future Rate Path Awaited on Thursday

Dow Jones09-08 13:05

0505 GMT - A 25-basis-point interest-rate hike by the European Central Bank on Thursday is the most likely scenario, according to State Street Investment Management. "The real significance of the meeting is therefore likely to lie less in the interest-rate decision itself than in the signals regarding the future course of monetary policy," says Konrad Kleinfeld, head of fixed income distribution EMEA for SPDR ETF, in a note. The latest inflation data do not provide a clear signal in this regard, as the headline inflation rose to 3.3%, driven primarily by higher energy prices, while core inflation and services inflation have so far remained relatively moderate, while broader second-round effects have been only limited so far, he says. "From the ECB's perspective, this increases the need for communication."

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