However, investors must consider the sub-components, including prices. Higher input and output price trends would reduce expectations of a September ECB rate cut. The ECB is concerned more about inflation than the economy.
During the ECB press conference on Thursday, July 18, ECB President Lagarde said the ECB was data-dependent.
German business sentiment will be in the focus on Thursday. Weaker sentiment toward the German economy could raise investor bets on a September ECB rate cut. Softer business confidence could affect job creation, wage growth, and consumer spending. Downward trends in consumer spending may dampen demand-driven inflation.
With a busy economic calendar, investors should monitor ECB commentary. ECB President Christine Lagarde (Thurs) and Chief Economist Philip Lane (Tues/Wed) are on the calendar to speak. On…
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