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What next for the proposed ECB rate increase ?

  • 10-08-2011 9:21am
    #1
    Rabidlamb
    Banned (with Prison Access) Posts: 2,202 ✭✭✭


    In light of this weeks events can we expect the next round of increases to be stalled.
    I believe there was another .25% increase expected in the coming months.
    Conversely, could a decrease be argued for ?.


Comments

  • #2
    fliball123
    Registered Users, Registered Users 2 Posts: 7,540 ✭✭✭fliball123


    Rabidlamb wrote: »
    In light of this weeks events can we expect the next round of increases to be stalled.
    I believe there was another .25% increase expected in the coming months.
    Conversely, could a decrease be argued for ?.

    Well if the ECB are keeping to form if they look at how the markets rallied after the US stated theres would remain close to zero for the next 2 years ...and with the ECB doing everything to appease the markets they may well leave it as is or possible a decrease


  • #3
    spank_inferno
    Closed Accounts Posts: 3,892 ✭✭✭spank_inferno


    Inflation or the fear of Inflation has always been the main guide for ECB interest rate policy.

    If they see inflation continue at its current pace or increasing across the Eurozone, they feel mandated to raise interest rates to combat this.

    The US has tended to feel that inflation is a price worth paying to stimulate economic growth & as such are willing to keep their key interest rate lower.


    Though not unconnected, the jitters of stock-brokers wont have much bearing on the ECB policy group.


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