Econostream @EconoStream

ECB Tone Meter Weekly Update: Governing Council Turns Slightly Less Hawkish After June Hike #ECB #centralbanks #monetarypolicy econostream-media.com/news/2026-06-1…

🏖️❌ No July hike? So far, ECB communication since yesterday's hike does not suggest policymakers see a July move as the default next step. While there is clearly a willingness to follow up on yesterday's hike with another, comments are at least equally consistent with action post-July. As a result, our #ECBToneMeter has turned slightly less hawkish. The speakers so far — Nagel 🇩🇪, Moulin 🇫🇷, Rehn 🇫🇮, Kocher 🇦🇹, Makhlouf 🇮🇪, Dolenc 🇸🇮 or Kaasik 🇪🇪 — have limited themselves to expressions of a generalized readiness to act if needed amid ongoing concern about the shock's undeniable persistence. Check out our #ECBToneMeter here 🔗 econostream-media.com/tonemeter.html

ECB Insight: Lagarde Resists Roadmap, But Keeps Another Hike in Play #ECB #centralbanks #monetarypolicy econostream-media.com/news/2026-06-1…

‼️ Lagarde says the ECB has introduced a third alternative scenario, dubbed the "mildest scenario."

Econostream @EconoStream

3 days ago

‼️ Lagarde says neither a hold nor a 50bp rate hike was discussed at today’s meeting. "The decision that we took today to raise by 25bp our three interest rates was a unanimous decision without reservations, we did not discuss or debate any other alternative proposal."

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‼️ Lagarde says neither a hold nor a 50bp rate hike was discussed at today’s meeting. "The decision that we took today to raise by 25bp our three interest rates was a unanimous decision without reservations, we did not discuss or debate any other alternative proposal."

‼️ Lagarde notes that short-term inflation expectations remain "well above" levels prior to the Middle East war, but reiterates that "most measures of longer term inflation expectations stand at around 2%, supporting the stabilization of inflation around target in the medium term."

🔴 We are now in the ECB press conference room, awaiting Christine Lagarde’s press conference. She is due to speak at 14:45 CET.

👉Data dependency: 📌April 2026: "We will closely monitor the situation and follow a data-dependent and meeting-by-meeting approach to determining the appropriate monetary policy stance. … We are not pre-committing to a particular rate path." 📌 June 2026: "It will closely monitor the situation and follow a data-dependent and meeting-by-meeting approach to determining the appropriate monetary policy stance. ... The Governing Council is not pre-committing to a particular rate path."

👉Inflation expectations: 📌 April 2026: "Longer-term inflation expectations remain well anchored, although inflation expectations over shorter horizons have moved up significantly." 📌June 2026: *No mention to inflation expectations in the statement*

🇪🇺 The ECB hikes rates by 25bp amid the Iran war. Let's check the language of its statement today vs April 30: What changed and what stayed the same on its monetary policy statement? Find out in this #thread 🧵

🔴 #BREAKING | The ECB delivers a widely expected 25bp rate hike and updates its baseline projections, raising its inflation forecasts while lowering its growth outlook. Explore the revised projections here:

econostream-media.com/news/2026-06-0…

⏳Just three days to go until what looks set to be the ECB’s next rate hike. 👀 Which policymakers have explicitly pointed to a June move? 🇧🇪 Wunsch: "[T]here is probably still a case for hiking [even if the US and Iran were to reach a peace deal], it's just a bit less strong." (3 June) 🇱🇹 Šimkus: "I think there is no need to surprise the markets and not make decisions. In my opinion, we have a 25bp interest rate increase in place." (2 June) 🇬🇷 Stournaras: "The most likely development is a rate hike in June." (27 May) 🇪🇺 Schnabel: "I think a rate hike in June will be needed." (26 May) 🇲🇹 Demarco: "In June we probably might need to hike." (22 May) 🇦🇹 Kocher: "[I]f we believe that 2% inflation is unattainable, then an interest rate hike is necessary." (19 May) 🇩🇪 Nagel: "There is a higher probability now that we are now away from the baseline scenario, and that means that maybe we have to do something." (19 May) 🇨🇾 Patsalides: "As things stand, things are worsening. So, things are pointing to a raise in interest rates." (11 May) 🇸🇰 Kažimír: "[P]olicy tightening is all but inevitable." (4 May) More communication patterns ahead of the ECB’s June meeting in our #ECBCommentRecap ⬇️

🚨#EXCLUSIVE | Estonian State Treasury Head: Aim to Issue One or Two Benchmark Bonds Per Year econostream-media.com/news/2026-06-0…

3⃣ Some of the most hawkish policymakers never explicitly backed a June move, preferring more indirect signaling. Not every hawk chose to prepare markets by openly calling for a June hike. Some like 🇮🇪 Gabriel Mahklouf instead emphasized readiness to act if needed, others like 🇪🇺 Frank Elderson suggested it was “increasingly unlikely” for the ECB to look through the energy shock, allowing markets to draw their own conclusions about the likely timing of the next move.

2⃣ Explicit signals became much more frequent in the second half of May. While a few policymakers were already preparing markets for a June hike in early May, explicit references to a June move became markedly more common later in the month. This suggests the Governing Council's confidence in the case for a hike increased as fresh data and analysis became available ahead of the meeting.

This insightful chart maps how ECB policymakers signaled a June rate hike: 🔹Explicit June hike signals came mainly from hawks, but support gradually broadened. 🔹Explicit signals became much more frequent in the second half of May. 🔹Some of the most hawkish policymakers never explicitly backed a June move, preferring more indirect signaling. Let’s explain why 🧵