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BRIEF: Hawkish Speeches Fuel Expectations Of Bigger ECB Hike

MNI (London)

Speeches by Isabel Schabel and Francois Villeroy de Galhau add to speculation the ECB could hit the accelerator.

The prospects of the ECB hitting the rate-hike accelerator again when it next meets on Sept. 8 have risen after hawkish comments from policymaker heavyweights at the Jackson Hole symposium over the weekend and ahead of Wednesday's release of eurozone August CPI data, with analysts expecting a further increase in the headline rate to over 9%.

Executive Board member Isabel Schnabel on Saturday reinforced her view that the ECB should focus on actual price outcomes over projections to avoid embedding high inflation. Speaking at Jackson Hole the same day, Bank of France Governor Francois Villeroy de Galhau called for another significant rate hike in September, hitting a 'neutral level' which he has estimated to be between 1% and 2% by the end of the year.

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The prospects of the ECB hitting the rate-hike accelerator again when it next meets on Sept. 8 have risen after hawkish comments from policymaker heavyweights at the Jackson Hole symposium over the weekend and ahead of Wednesday's release of eurozone August CPI data, with analysts expecting a further increase in the headline rate to over 9%.

Executive Board member Isabel Schnabel on Saturday reinforced her view that the ECB should focus on actual price outcomes over projections to avoid embedding high inflation. Speaking at Jackson Hole the same day, Bank of France Governor Francois Villeroy de Galhau called for another significant rate hike in September, hitting a 'neutral level' which he has estimated to be between 1% and 2% by the end of the year.

Keep reading...Show less