European Central Bank Press conference comparison — 7 March 2019 vs 6 June 2019
This European Central Bank press conference comparison covers 7 March 2019 and 6 June 2019. Overall, the newer document was more dovish. The ECB's June meeting marks a clear dovish shift relative to March: the forward guidance horizon was extended and the Governing Council explicitly flagged readiness to cut rates or restart QE if adverse contingencies materialize, despite a somewhat hawkish TLTRO III design. The next decision is likely to deliver further easing if downside risks to growth and inflation persist.
What changed
More dovish. The ECB's June meeting marks a clear dovish shift relative to March: the forward guidance horizon was extended and the Governing Council explicitly flagged readiness to cut rates or restart QE if adverse contingencies materialize, despite a somewhat hawkish TLTRO III design. The next decision is likely to deliver further easing if downside risks to growth and inflation persist.
- Inflation — More hawkish. Inflation assessment shifted from explicitly muted and patience needed to a more balanced view with wage pressures noted, reducing urgency for accommodation.
- Labour Market — Little changed. Labour market language remains similar, highlighting tight markets and wage growth without significant change in stance.
- Rate Path — More dovish. Forward guidance extended further into 2020 and explicit readiness to ease signaled, more dovish than prior, despite TLTRO III pricing being slightly hawkish.
- Balance Sheet — More dovish. Balance sheet stance shifted from no discussion of QE in March to explicit headroom and readiness to restart APP in June, a clear dovish opening.
Key wording
we decided to keep the key ECB interest rates unchanged. We now expect them to remain at their present levels at least through the end of 2019, and in any case for as long as necessary to ensure the continued sustained convergence of inflation to levels that are below, but close to, 2% over the medium term.
Moreover, underlying inflation continues to be muted.
The risks surrounding the euro area growth outlook are still tilted to the downside, on account of the persistence of uncertainties related to geopolitical factors, the threat of protectionism and vulnerabilities in emerging markets.
labour cost pressures have strengthened and broadened amid high levels of capacity utilisation and tightening labour markets.
We moved the calendar-based part of our forward guidance from September to December.
they were unanimous.
we decided to keep the key ECB interest rates unchanged. We now expect them to remain at their present levels at least through the first half of 2020
measures of underlying inflation remain generally muted, but labour cost pressures continue to strengthen and broaden amid high levels of capacity utilisation and tightening labour markets.
The risks surrounding the euro area growth outlook remain tilted to the downside
We have basically by and large tight labour markets everywhere in the Eurozone and rising wages.
The extension of the six months of this forward guidance basically takes into account the prolongation of uncertainty with respect to what we saw and believed and deemed in March.
Several members raised the possibility of further rate cuts. Other members raised the possibility of restarting the asset purchase programme, or further extensions in the forward guidance.
Official documents
Background reading
Related
7 March 2019 press conference · 6 June 2019 press conference · Earlier meeting · Later meeting · Next comparison · Methodology
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