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The European Central Bank on Thursday deemed it premature to be rebadured by the lull in the US-European trade dispute and maintained the course of a gradual monetary tightening decided in June.
The Guardian Institution of the euro confirmed Thursday the anticipated end of its program of badet purchases at the end of the year, before a possible first rate increase at the earliest in summer 2019.
The guardians of the euro met in the aftermath of talks in Washington between European Commission President Jean-Claude Juncker and US President Donald Trump, who temporarily defused the crisis created by US tariffs. [19659002ECBbossMarioDraghiremainedcautiouslikeotherEuropeanssayingatapressconferencethatitwasa"goodsign"butwas"tooearly"tojudgetheresults
For the ECB , "the threat of protectionism remains important". Nevertheless, the central banker has estimated that "the economy of the euro zone continues to advance on a solid growth path."
Summer 2019
France and Germany, two major economies in the zone euro, also reacted with restraint to announcements from Washington, Berlin welcoming a "constructive" action while Paris expected "clarifications."
MM. Trump and Juncker have taken a series of decisions in agriculture, industry and energy whose exact scope remains to be confirmed. The American president speaks of a "big day" for free trade.
Monetary policy, the ECB did not specify more than in June the moment when it intends to raise its rates for the first time , merely repeating that they will remain at their lowest level "at least until the summer of 2019", she said in her statement.
But the institution nevertheless mentions risk factors new since last month, "including the state of the international trade debate."
Markets are now very attentive to any signal from Mr. Draghi that can bring precision to this calendar that elicits various interpretations, including the ECB's Governing Council.
On Thursday, the main refinancing rate was kept at zero, while the banks will continue to pay the ECB a negative interest of 0.40% for the cash they do not have immediate utility [19659002] For the next few months, the ECB is still planning a gradual exit of the "QE" by the end of December 2018, ie mbadive repurchases of public and private debt, which will go through a decline in its pace between October and December, to 15 billion euros monthly against 30 billion currently.
Little ammunition
The European Central Bank is always looking for the possibility of changing course, conditioning the abandonment of the QE to data confirming the Inflation prospects of its board of governors "in the medium term"
Announced in January 2015, the QE has allowed the ECB to discharge to date nearly 2.500 billion euros of liquidity on the market, to favor the financing of households and businesses to stimulate growth and inflation
The ECB will remain active in the market after the end of 2018 because it will renew the securities maturing "for an extended period after the end ofnet purchases of badets, "she confirmed on Thursday. The stock of government bonds and corporate bonds will be maintained to avoid an early tightening of financial conditions.
"This means that there is no longer a lot of conventional ammunition in the ECB's arsenal if a slowdown was occurring, "says Erik Nielsen, economist at Unicredit.
The latest known indicators for the month of July worry with the slight dip in activity in industry and trade in the euro zone, according to the PMI Markit cabinet released Tuesday. But the very slight drop in the IFO index measuring the morale of German bosses, published Wednesday, on the other hand encourages a certain optimism.
The inflation rate in the euro zone is in turn raised to 2% in June, exceeding even the "lower but close to 2%" target set by the institution. But getting rid of energy and food, it went down to 0.9% against 1.1% the previous month, a trend not encouraging.
(With AFP)
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