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ECB Accounts: There is a broad consensus among members that it was premature to talk about rate cuts

Accounts from the European Central Bank's (ECB) January monetary policy meeting showed on Thursday that there was broad consensus among Governing Council members that it was premature to discuss rate cuts, according to Reuters.

Main statements

“The recent evolution of economic activity and inflation is consistent with the current orientation of monetary policy.”

“There had been new advances in all three elements of the reaction function.”

“There is confidence that monetary policy was working.”

“It was stated that it was necessary to continue advancing in the disinflationary process.”

“There is broad consensus among members that it was premature to discuss rate cuts.”

“Measures of core inflation had surpassed their maximum level.”

“The risk of cutting interest rates too early still outweighed the risk of cutting interest rates too late.”

“There was strong evidence that monetary policy was being transmitted to financial markets, to financing conditions and to credit conditions.”

“Uncertainty remains about the timing of maximum impact.”

“Members noted that continuity, caution and patience remain necessary.”

“The risks to achieving the inflation target were generally considered balanced or, at least, increasingly even.”

“Easing financial markets could be premature and possibly derail or delay a timely return of inflation to target.”

Market reaction

This release did not cause a notable reaction in the EUR/USD pair, which was last up 0.25% on the day, to 1.0845.

Source: Fx Street

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