ECB minutes show a rise in interest rates in July

As the minutes of the last meeting of the Governing Council of the European Central Bank (ECB) show that the “hawks” are gaining the upper hand, ECB Vice President Louis de Guidos says the emergency measures need to be phased out. At the same time, the minutes of the ECB’s April meeting published today show that the so-called hawks are gaining more and more ground in the discussions. So the question now is not whether the ECB will raise its interest rates in July but whether that increase will be 0.25% or 0.5%.

The majority of ECB policymakers are increasingly concerned about the problem of inflation. In fact, as they point out, both the war in Ukraine and the anti-pandemic measures taken in China have shown that price pressures are likely to intensify further, affecting inflation for a relatively long period of time. Central bankers are obsessed with the constant stress lest a rise in prices lead to higher price increases. While the ECB currently sees only moderate wage pressure, “there could be little doubt that workers would eventually seek compensation for the loss of real income,” he said.

In the domestic bond market and more specifically in HDAT, transactions of 123 million euros were recorded, of which 67 million euros related to purchase orders. The yield on the 10-year bond stood at 3.54%, from 3.57% yesterday, compared to 0.95% of the corresponding German bond, resulting in a margin of 2.59% from 2.52% that closed yesterday.

In the foreign exchange market, the euro is moving slightly higher against the dollar as the European currency traded early in the afternoon at $ 1.06 from the $ 1.0587 that the market opened.

The indicative price for the euro / dollar exchange rate. announced by the ECB reached $ 1.0525.