Some ECB members believe the tightening at the end of 19 is probably too late

As of: 09:09 | Duration: 2 minutes

F Monetary policy officials of the European Central Bank are not entirely convinced that investors are not expecting rates to rise before December 2019 Those who are familiar with the considerations.

A move in September or October of next year is conceivable, said the people who requested anonymity because the discussions were confidential. However, any decision on interest rates will depend on the economic outlook of the time.

Money market investors will not fully rent an increase in the deposit rate of 10 basis points until December 2019. But, according to the report, they have increased the likelihood of a rate hike in September from less than 70% to 80%.

While it will take a year or more before the first rate hike, timing is important. The ECB will mark years of monetary stimulus. The September and October meetings of the Board of Governors are also the latest opportunities for President Mario Draghi to end his term, which expires on October 31, 2019.

Decision QE

The ECB has announced last month that it will end net bond purchases this year, but also that it will leave interest rates unchanged "at least during the summer of 2019" . The wording has generally been interpreted to leave open the possibility of increasing borrowing costs as early as the September meeting. [16] However, Councilor Vitas Vasiliauskas said that the guidelines should be interpreted as "until the end of September", reflecting the ambiguity

Since the decision, the accommodative rhetoric of officials of the Monetary policy, including Draghi, dominated the market trend. The economists of ABN Amro have postponed their bets from September to December after the last meeting of the ECB.

While the ECB has just announced the expiration of its bond purchases, the topic of interest is already playing a major role. Peter Praet, chief economist of the central bank, said on Tuesday that the new guidelines underscored the key role of interest rates as a key tool in the future. In addition, the ECB has adjusted the French, German and Spanish translation of the interest rate guarantee into the June monetary policy statement.

BNP Paribas economists have said that these changes support their view that a rate hike in September is possible. their basic scenario.