Morgan Stanley analysts say the ECB is likely to keep rates unchanged at next
week’s policy meeting after the June hike. Incoming data since June leave the
bank between its mild and baseline scenarios, and recent remarks from the ECB
president and Governing Council members are consistent with market expectations
that the bank will stand pat. Analysts note renewed oil-price volatility
reinstates fundamental uncertainty in energy inflation and is sufficient reason
for the ECB to avoid signaling a policy tilt in its statement or press
conference pending more economic data.
