The Ibex-35 struggles to hold 8,800 points as it awaits new clues on the pace of rate hikes
After two near-flat closes, the Ibex-35 is ahead of the most anticipated session of the week at 0.4% to 8,813 points, with the European Central Bank (ECB) meeting the absolute star of the day.
It is true that no change is expected with regard to monetary policy. But investors do expect new clues as to how things will develop in the coming months, especially from September. Gilles Moëc, chief economist at AXA Investment Managers, does not believe there is a clear mapping around this issue at the meeting of the body chaired by Christine Lagarde.
However, the ECB will have to be more specific with quantitative easing. That is, in the first days of July formally announce the end of the asset purchase program (APP). Shortly afterwards, at the meeting of the same month, the first rate hike would take place.
And this is what the experts agree on. While there has been much speculation about the possibility that this increase will reach 50 basis points in light of the sharp rise in inflation, the agency would choose to maintain plans for a 25-point increase “which would leave September to lower the deposit rate.” to positive territory.
Most worrying is the potential market reaction, especially in light of deteriorating macroeconomic conditions. Something that was already reflected in the debt markets, where the yield on the 10-year German bond, the main benchmark in Europe, rose again to 1.35% before the ECB meeting. Just three months ago, it was still trading in the negative sign.
In the commodities market, the price of a barrel of Brent remains above USD 123, while the American West Texas trades at USD 122.
Source: La Verdad
I’m Wayne Wickman, a professional journalist and author for Today Times Live. My specialty is covering global news and current events, offering readers a unique perspective on the world’s most pressing issues. I’m passionate about storytelling and helping people stay informed on the goings-on of our planet.
