Investors await first signs of Christine Lagarde’s ECB policy stance

Little immediate shift expected for Eurozone as former IMF chief takes over at central bank

Investors await first signs of Christine Lagardes ECB policy stance                                 

Investors are awaiting the outcome of Christine Lagarde’s first meeting as president of the European Central Bank (ECB).

Although the new boss of the Eurozone's central bank is not expected to take any major decisions, commentators and investors throughout Europe and abroad will closely monitor the meeting for any points of difference between her and predecessor Mario Draghi.

On assuming her role, Lagarde announced a swift policy review, the ECB’s first since 2003.

High on her to-do list are reuniting the bank’s Governing Council, and healing the wounds from the controversial policy decision to reinstate quantitative easing (QE) in September

In recent speeches Lagarde has emphasised the negative side effects of the current policy stance — more than Draghi ever would have.

Lagarde, who was found guilty of negligence while head of the International Monetary Fund, has never been a central banker before.

In an interview last month with German weekly Die Ziet, she signalled her dissatisfaction with traditional monetary policy categories such as “dove” and “hawk”, who favour looser and tighter monetary policy respectively. “I hope I will be an owl," she said. "I like owls. They are very wise animals.”

Although no immediate policy changes are expected today, analysts will closely monitor the ECB’s economic outlook and inflation expectations. In particular the 2022 inflation forecast will be seen as a weathervane for Lagarde’s stance.

Further Reading: Mario Draghi bows out of ECB with rates unchanged

Further Reading: ECB urged to act together on inflation

The material provided on this website is for information purposes only and should not be regarded as investment research or investment advice. Any opinion that may be provided on this page is a subjective point of view of the author and does not constitute a recommendation by Currency Com Bel LLC or its partners. We do not make any endorsements or warranty on the accuracy or completeness of the information that is provided on this page. By relying on the information on this page, you acknowledge that you are acting knowingly and independently and that you accept all the risks involved.
iPhone Image
Trade the world’s top tokenised stocks, indices, commodities and currencies with the help of crypto or fiat
iMac Image
Trade the world’s top tokenised stocks, indices, commodities and currencies with the help of crypto or fiat
iMac Image