{"id":2594,"date":"2008-05-30T08:51:41","date_gmt":"2008-05-30T08:51:41","guid":{"rendered":"https:\/\/mmm.9dotdigital.ca\/?p=2594"},"modified":"2025-03-27T15:48:39","modified_gmt":"2025-03-27T15:48:39","slug":"ecb-ometer-suggesting-rate-hike-more-likely-than-cut","status":"publish","type":"post","link":"https:\/\/mmm.9dotdigital.ca\/?p=2594","title":{"rendered":"ECB-ometer suggesting rate hike more likely than cut"},"content":{"rendered":"<p>My <a href=\"http:\/\/www.moneymovesmarkets.com\/journal\/2007\/11\/26\/ecb-ometer-suggesting-shift-to-neutral-policy-stance.html\">ECB-ometer<\/a> shifted from a tightening to an easing bias between late 2007 and early 2008, reflecting weaker economic news and financial market stresses. In early March, as the credit crisis moved towards a climax, it suggested a 40% chance of a rate cut at that month&rsquo;s ECB meeting. The move has since reversed, however, as markets have normalised and inflation indicators have worsened. <\/p>\n<p>Based on available data, the model suggests a 30% chance of a hike in official rates at next week&rsquo;s ECB meeting &ndash; see chart. This compares with a small probability of a cut last month. The change is due to a combination of strong first-quarter GDP numbers, a further deterioration in both survey- and market-based measures of inflation expectations and a rebound in M3 growth. These developments have offset weakness in survey activity indicators. <\/p>\n<p>It is too soon to expect a reappearance of &ldquo;vigilance&rdquo; but next week&rsquo;s policy statement and press conference could signal a hawkish bias. <\/p>\n<p><span class=\"full-image-float-none\"><img decoding=\"async\" style=\"width: 500px; height: 300px\" alt=\"ECB_Repo_Rate_300508.jpg\" src=\"\/storage\/ECB_Repo_Rate_300508.jpg\" \/><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>My ECB-ometer shifted from a tightening to an easing bias between late 2007 and early 2008, reflecting weaker economic news and financial market stresses. In early March, as the credit crisis moved towards a climax, it suggested a 40% chance of a rate cut at that month&rsquo;s ECB meeting. The move has since reversed, however, [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3],"tags":[],"class_list":["post-2594","post","type-post","status-publish","format-standard","hentry","category-money-moves-markets"],"_links":{"self":[{"href":"https:\/\/mmm.9dotdigital.ca\/index.php?rest_route=\/wp\/v2\/posts\/2594","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/mmm.9dotdigital.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mmm.9dotdigital.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mmm.9dotdigital.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/mmm.9dotdigital.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=2594"}],"version-history":[{"count":1,"href":"https:\/\/mmm.9dotdigital.ca\/index.php?rest_route=\/wp\/v2\/posts\/2594\/revisions"}],"predecessor-version":[{"id":4903,"href":"https:\/\/mmm.9dotdigital.ca\/index.php?rest_route=\/wp\/v2\/posts\/2594\/revisions\/4903"}],"wp:attachment":[{"href":"https:\/\/mmm.9dotdigital.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=2594"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mmm.9dotdigital.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=2594"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mmm.9dotdigital.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=2594"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}