The ECB meeting next week is expected to be largely a stock taking meeting and not a place to send new policy signals. The meeting by meeting and data dependent approach is clear and Lagarde has highlighted that the profit, wages and productivity data will be key, albeit those data points will only come from the middle of August and thus the focus turns to the September meeting.
Comments from ECB’s GC point to a ‘reasonable’ market pricing and thus we do not expect that the ECB will want to send signals to alter the market pricing of monetary policy restrictiveness in the months and quarters to come.
