ECB: Cut in April seems likely – Standard Chartered

The April monetary policy meeting could be a closed case, but we lean towards a 25 basic points cut. For now, our base scenario is to maintain in June, but we see growing risks of another cut given the tariff threats. The fiscal stimulus and the tariff uncertainty mean that several scenarios for the ECB policy are plausible, says Standard Chartered analysts, Christopher Graham and Saabir Salad.

Compensatory Risks – Tariffs against Prosecutor

“We hope that the European Central Bank (ECB) will carry out a seventh consecutive cut of 25 basic points at its policy meeting next week (April 17). Recent economic data – significantly the fall greater than expected in the inflation of services of March – and the moderate comments of the members of the Governing Council (CG) support this opinion. However, the announcement of an extension of 90 days on the reciprocal tariff The US on April 9 means that a cut is far from guaranteed, since some Halcons of the CG could now press more for a pause. “

“If the ECB cuts next week, then the June meeting could offer an opportunity to maintain, which for now is our base scenario. The debate around the neutral rate will become more acute as the deposit rate falls more, with hawks and centrist becoming more resistant to greater relief without a clear economic justification. However, that justification could be built in the coming weeks depending on any additional development on any additional development on any additional development on any additional development on any additional development on any additional development on any additional development on any additional development on any additional development on any additional development on any additional development on any additional development on any additional development on any additional development on any additional development on any additional development on any additional development on any additional development on any additional development on any additional development on any additional development on any additional development on any additional development on any additional development on any additional development on any additional development on any additional development on any additional development on any additional development on any additional development on any additional development on any additional development on any additional development on any additional development on any additional development on any. USA and Progress (if any) of the commercial negotiations between the US and the EU for that time;

“However, for the June meeting we should also have greater clarity on the tax stimulus plans of Germany, as well as on the increase in defense expenditure throughout the EU; the updated macroeconomic projections of the ECB should reflect the implications of growth and inflation of both. The degree of economic uncertainty is clearly high, and the combination of risks to the rise of the fiscal stimulus and the downward risks and risks Tariff means that several scenarios for ECB rates remain plausible;