Le European stock exchanges they proceed timidly upwards waiting to hear the verdict of the fed. Today evening, in fact, the US central bank will reveal its eagerly awaited decision on interest rates after the earthquake that hit US banks. According to futures on Fed Funds, Powell will in all probability (89,3%) announce a rise of 0,25% while according to the remaining 10,7% he will keep rates unchanged.
Lagarde on rates: "We don't commit to raising them, but we haven't finished doing it"
Meanwhile, from the annual conference The ECB and Its Watchers in Frankfurt, the president of the European Central Bank, Christine Lagarde he confirmed: “We can be sure of one thing: we will achieve price stability and we will not compromise on our commitment to bring inflation back to 2% in the medium term. This means that, ex ante, we are not committed to raising rates further of interest but we have not finished doing it”. The number one of the ECB underlined that "to this end we will follow a solid strategy, which is based on data and sees us ready to act, but without compromising our primary objective".
After the Eurozone was hit by an inflationary shock, which is spreading through the economy, it is now expected that this year the cost of living shows “a sharp decline due to falling energy prices and the easing of supply bottlenecks, but underlying inflation dynamics remain robust”. In this context, Lagarde underlined, “our goal is clear: we must promptly bring inflation back to the medium-term objective and we will do so”.
The president of the ECB then explained that the future of monetary policy “will be determined by three factors: our assessment of the inflation outlook in the light of the most recent economic and financial data, the dynamics of underlying inflation and the intensity of the monetary policy transmission”.
Speaking of the European banking sector, Lagarde said that "in light of the recent volatility in financial markets we stand ready to act and provide, if necessary, liquidity to support the financial system and preserve the orderly transmission of monetary policy." “But it must be clear that there is no need for compromises between price stability and financial stability. As we have demonstrated time and time again, we are able to establish the appropriate monetary policy stance to keep inflation at bay and at the same time use other tools to address risks to monetary policy transmission”.
The hawk is also intervening on the matter today Joachim Nagel, president of the Bundesbank, who affirmed that those who set rates must be "more stubborn" in the fight against inflation, writes today the Financial Times.
UK inflation above expectations
Recono known this morning one of the most anticipated macro data of the day. As of February 2023, UK inflation increased by 1,1% month on month. Compared to the same month of 2022, the increase is equal to 10,4%. The data is higher than the expectations of analysts who expected +0,7% on the month and +9,9% on the year.
The latest news on European Stock Exchanges
In this context, the European stock exchanges are proceeding in positive territory, with the Ftse Eb which in the middle of the day rises by 0,26% to 26.624 points. Photocopy performance for Paris e Madrid, while Frankfurt travels up by half a percentage point. Flat Zurich where the title Credit Suisse sells 3,5% and the shares ubs they travel in the red by 2,57%. Mark +0,14% London.
In Milan the banks go up
On the Ftse Mib it is Iveco the pink jersey (+2,42%), followed by Leonardo (+ 1,94%) and FinecoBank (+1,58%). The bank led by Alessandro Foti was promoted by Equita due to the solidity and liquidity of its balance sheet.
In green the banking sector: Intesa Sanpaolo (+ 1,53%), Mps (+ 1,13%), Bper (+ 0,76%), Unicredit (+ 0,74%).
Weak utilities, with A2a at the bottom of the list (-1,77%). Negatives too Italgas (-0,9%), Terna (-0,84%) Snam (-0,7%) ed Ivy (-0,68% after the accounts).
Below parity (-0,17%) Telecom Italy, which during the night signed an agreement with the trade unions that provides 2 thousand voluntary exits in 2023, to be implemented through the isopension tool.
Spreads and returns
It's up slightly spread between Btp and Bund which stands at 185 basis points from 182 on 21 March. The yield on ten-year BTPs also rose, reaching 4,15% from 4,10% in the middle of the session.
