Market movers today
Today’s ECB meeting will be interesting although a rate cut seems unlikely. Draghi could counter rising money market rates with a refinancing rate cut but the case seems less clear-cut now than a month ago. With data continuing to improve, PMI signalling growth and consumer confidence at the highest in two years we think that a rate cut is unlikely. Draghi will almost certainly repeat the forward guidance given last month. The market is likely to react positively if Draghi specifies this and e.g. says that ‘an extended period is more than 12 months’. Draghi said yesterday that the publication of the minutes from the ECB’s Governing Council meeting is an ‘important next step’. We expect an announcement on increased transparency today.
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Danske Bank