ECB: Positive Communication of the Week – Nomura
According to analysts at Nomura, communications from the ECB have been more positive this week as ECB officials have moved toward communicating that the ECB meeting June “Live” for APP’s decision.
ECB Economist Peter Praet said recently while mentioning wage data was negotiated that “there is growing evidence that the tight labor market translates into a stronger increase in wage growth.” He also said “the underlying strengths in the euro area economy and the fact that these forces are increasingly affecting wage formations supports our belief that inflation will reach levels below, but is approaching, 2% in the medium term. “The ECB’s recent hawkish communications officers were partly intended to send a message that the ECB’s policies will not be affected by politics Italy, but Praet’s comments suggest the ECB’s view on inflation is also rising. ”
“Further EUR recovery now looks likely to the ECB meeting and the annual meeting in Sintra, as we expect the ECB to maintain its optimistic communications behind stronger wage and inflation data.”