ECB’s Nagel: Core inflation is also going in the right direction

Source Fxstreet

In an interview with Deutschlandfunk early Friday, European Central Bank (ECB) policymaker and Bundesbank President Joachim Nagel said that the “core inflation is also going in the right direction.”

Additional quotes

Expect to reach our inflation goal at the end of next year.

On EU competition proposals: Mario Draghi is correct on a lot of points.

We must come together as Eeuropeans to overcome weak investment.

Market reaction

These comments fail to move the needle around the Euro, as the EUR/USD pair keeps its range at around 1.1080, up 0.08% on the day, at the press time.

ECB FAQs

The European Central Bank (ECB) in Frankfurt, Germany, is the reserve bank for the Eurozone. The ECB sets interest rates and manages monetary policy for the region. The ECB primary mandate is to maintain price stability, which means keeping inflation at around 2%. Its primary tool for achieving this is by raising or lowering interest rates. Relatively high interest rates will usually result in a stronger Euro and vice versa. The ECB Governing Council makes monetary policy decisions at meetings held eight times a year. Decisions are made by heads of the Eurozone national banks and six permanent members, including the President of the ECB, Christine Lagarde.

In extreme situations, the European Central Bank can enact a policy tool called Quantitative Easing. QE is the process by which the ECB prints Euros and uses them to buy assets – usually government or corporate bonds – from banks and other financial institutions. QE usually results in a weaker Euro. QE is a last resort when simply lowering interest rates is unlikely to achieve the objective of price stability. The ECB used it during the Great Financial Crisis in 2009-11, in 2015 when inflation remained stubbornly low, as well as during the covid pandemic.

Quantitative tightening (QT) is the reverse of QE. It is undertaken after QE when an economic recovery is underway and inflation starts rising. Whilst in QE the European Central Bank (ECB) purchases government and corporate bonds from financial institutions to provide them with liquidity, in QT the ECB stops buying more bonds, and stops reinvesting the principal maturing on the bonds it already holds. It is usually positive (or bullish) for the Euro.

 

Disclaimer: For information purposes only. Past performance is not indicative of future results.
placeholder
Understanding the first crypto market crash of 2024 and what to expect nextThe 365-day MVRV ratio suggests that this crash may be just the beginning. If the ETF is rejected before the second quarter of 2024, it could trigger a sharp correction.
Author  FXStreet
Jan 04, Thu
The 365-day MVRV ratio suggests that this crash may be just the beginning. If the ETF is rejected before the second quarter of 2024, it could trigger a sharp correction.
placeholder
Natural Gas sinks to pivotal level as China’s demand slumpsNatural Gas price (XNG/USD) edges lower and sinks to $2.56 on Monday, extending its losing streak for the fifth day in a row. The move comes on the back of China cutting its Liquified Natural Gas (LNG) imports after prices rose above $3.0 in June. It
Author  FXStreet
Jul 01, Mon
Natural Gas price (XNG/USD) edges lower and sinks to $2.56 on Monday, extending its losing streak for the fifth day in a row. The move comes on the back of China cutting its Liquified Natural Gas (LNG) imports after prices rose above $3.0 in June. It
placeholder
The $589 XRP Dream: Believers Aren’t ‘Delusional’ Enough, Expert SaysA known market analyst sees the $6 per coin prediction for XRP crypto being claimed by some experts as too conservative.
Author  NewsBTC
Dec 17, Tue
A known market analyst sees the $6 per coin prediction for XRP crypto being claimed by some experts as too conservative.
placeholder
XRP Price Steals the Spotlight: Dips Look Increasingly AttractiveXRP price started a fresh increase above the $2.50 zone. The price is now consolidating gains and might soon aim for a move above the $2.62 resistance. XRP price started a fresh increase above the
Author  NewsBTC
Dec 18, Wed
XRP price started a fresh increase above the $2.50 zone. The price is now consolidating gains and might soon aim for a move above the $2.62 resistance. XRP price started a fresh increase above the
placeholder
Nvidia vs. Broadcom: Which Is the Better AI Chip Stock to Own in 2025?When it came to artificial intelligence (AI) infrastructure in 2024, Nvidia (NASDAQ: NVDA) reigned supreme.
Author  The Motley Fool
Dec 19, Thu
When it came to artificial intelligence (AI) infrastructure in 2024, Nvidia (NASDAQ: NVDA) reigned supreme.
Related Instrument
goTop
quote