ECB leaves rates unchanged as Lagarde announces February exit
ECB kept its main rates unchanged, with Lagarde set to leave in February. Markets now see a 65% chance of a hike in December.
3 h ago5 min read
ECB sources indicate December rate hike then pause
ECB sources see a December rate hike followed by a pause; new estimates show bond yields cut growth by 100 bps and inflation by 90 bps.
29/10/2026 16:133 min read
According to ECB sources cited by Reuters,
- Policymakers anticipate a December rate increase followed by a pause.
- Fresh staff projections indicate that elevated bond yields reduce growth by a cumulative 100 bps and inflation by 90 bps in 2027-28 compared with the baseline.
Such a reduction is a significant hit to growth, particularly if ECB President Lagarde is correct that part of it stems from hyperscaler borrowing for spending in the US and Asia.
Market pricing already largely reflects a December hike, but the prospect of a pause draws attention. Policymakers might consider one additional hike sufficient, but that likely hinges on developments in the Iran and Ukraine conflicts.
The euro is experiencing some modest selling on this news, driven by the dovish signal of a pause beyond December.
Share to
Disclaimer: this article comes from third-party media and is provided for reference only. It does not constitute investment advice. Crypto and other financial products carry significant price volatility risk, so please make your own decisions carefully.
Related articles
Why prices often go against the headlines
Markets react to how news changes expectations, not to good or bad news. Positioning and forward-looking pricing explain price moves.
3 h ago13 min read
Lagarde: Near-term growth to be supported by AI spending and government outlays
Lagarde says AI investment and government spending will support near-term growth, but energy costs and financing headwinds persist.
3 h ago3 min read
ECB's Lagarde to leave post nearly a year before term ends
ECB President Christine Lagarde announced she will step down on February 7, 2027, nine months early, possibly allowing Macron to help pick her successorâŠ
3 h ago9 min read