Lagarde could provide clues about next eurozone interest rate cut

Various ECB members are speaking out to reinforce the same message and signal to markets that a lull is expected in the summer after the June rate cut. While many disagree on the intensity of the cuts, and some are talking about a single move, as in the case of Peter Casimir, member of the council, while Francois Villeroy, The governor of the Bank of France says he does not rule out several successive moves. Mario Centeno, The council member also talks about “several cuts.” The institution’s consensus appears to have closed off action entirely at this meeting and postponed a decision until September.

The most direct was Joachim Nagel, Bundesbank president, who has been pushing the idea since May. Even before the June cut, he had already said that “while it could probably be cut this month, we would then probably have to wait until September for the next step.” In a recent interview, the German insisted on the idea, ruling out the institution running on “autopilot” but again pointing to this month.

Another very influential member of the ECB, such as Isabel Schnabel, He has also been of the opinion since May that “a move in June does not seem justified.” For his part, another council member, such as Boris Vujicic In an interview with Bloomberg, he explained that after the June decision, “we need time.” In this sense, Vujicic said that “we will pay close attention to the data that will come in September, then we will have three more indicators of inflation, economic activity, labor market data and financial markets, as well as a new forecast,” he added. “July is always possible, but in September, much more data will be available.

The president Christine Lagarde and vice president, Luis de Guindoswere not as forthright, but they did point to a pause, although they did not name it directly. In the case of the French company, it was stated in various interviews earlier this month that “we need more data on…”. De Guindos directly referred to these “quarterly meetings” during an interview on RTVE in late June, claiming that “forecasts are updated every three months, the next one is in September,” Guindos said. “This is one of the most important points and the most interesting, because forecasts are an important indicator in deciding how interest rates will develop.”