Dávid Szőnyi’s Post

https://lnkd.in/gPjvnBWb I noticed this article just now. Negative interest rates are fascinating and I first became interested in them in 2015 in a college Fed Challenge competition. A negative interest rate from the central bank does not necessarily mean banks pass along that same interest rate to a consumer.

European Central Bank keeps interest rates unchanged in move that will “ripple through international markets” The interest rate on the main refinancing operations, marginal lending facility and the deposit facility will remain unchanged at 4.50%, 4.75% and 4.00% respectively.

At the start of 2023, we began flagging to our clients the potential for first-rate cuts in Central and Eastern Europe leading Western European counterparts. We currently forecast benchmark rate cuts across Czechia, Hungary, and Poland by the end of 2023, with Romania following in early 2024. These would all be ahead of the European Central Bank pivot expected in June 2024. Although we see varying degrees of reluctance in appearing dovish, easing interest rates and inflationary pressures will drive a growth rebound in these economies relative to regional peers in the eurozone. Read our latest blog to find out which central bank will cut first and the implications for borrowing costs: http://ow.ly/nKTc104PAjn

At the start of 2023, we began flagging to our clients the potential for first-rate cuts in Central and Eastern Europe leading Western European counterparts. We currently forecast benchmark rate cuts across Czechia, Hungary, and Poland by the end of 2023, with Romania following in early 2024. These would all be ahead of the European Central Bank pivot expected in June 2024. Although we see varying degrees of reluctance in appearing dovish, easing interest rates and inflationary pressures will drive a growth rebound in these economies relative to regional peers in the eurozone. Read our latest blog to find out which central bank will cut first and the implications for borrowing costs: http://ow.ly/nKTc104PAjn

At the start of 2023, we began flagging to our clients the potential for first-rate cuts in Central and Eastern Europe leading Western European counterparts. We currently forecast benchmark rate cuts across Czechia, Hungary, and Poland by the end of 2023, with Romania following in early 2024. These would all be ahead of the European Central Bank pivot expected in June 2024. Although we see varying degrees of reluctance in appearing dovish, easing interest rates and inflationary pressures will drive a growth rebound in these economies relative to regional peers in the eurozone. Read our latest blog to find out which central bank will cut first and the implications for borrowing costs: https://ow.ly/ly0S50PmTyv

🔴🟡 Managing Director for Bibby FX, Michael McGowan's comments on the European Central Bank's decision to hold its benchmark deposit rate at 4% feature in The Intermediary. 📅 With today's announcement that GDP grew by 0.1% in February raising hopes that the UK economy expanded overall during the first quarter, are we likely to see interest rates fall sooner rather than later? 🤷🏽♀️ Let us know your thoughts 👇🏽 #BibbyFX #SupportingBusinessAsUsual #InterestRates #SMEsupport

The first penny (or is it Euro cent) drops The European Central Bank started the interest rate cutting cycle with a 0.25% cut to bring rates down to 3.75%. Whilst this was somewhat expected, given Europe’s recent poor growth numbers particularly in it’s biggest economy Germany, it was still well received by markets. Whilst nobody could ever describe either the ECB or the BOE as “pro-active” this step was at least the first step in potentially a global rate-cutting cycle. I have mentioned before the almost total synchronicity of the interest rates' rises between the ECB, BOE and US Federal Reserve on the way up, and so, whilst the potential paths on the way back down will be different due to the significantly different growth paths of the US vs Europe and the UK, this at least provides cover to either of the other central banks to cut rates at their next couple of meetings. This is the good news. However, it does beg the question of how autonomous our Central Banks, and the members within them, actually are? In this sort of role, does anyone have any incentive to put their head above the parapet? Think of it this way, if you’ve got to the esteemed position of being elected to a Central Bank then your entire career has been in the “establishment” and are very much going to be consistent with the type of thinking of your colleagues. Some (me) would suggest this is a dangerous version of group-think. And if the last few years of policy making by either Governments or Central Banks has taught us anything, then this type of group-think needs to be thoroughly challenged. The recent review of the Bank of England’s processes, performed by Dr Ben Bernanke, former Governor of the US Federal Reserve, correctly identified a number of weaknesses. However, my concern is this will only serve to solidify this group-think with a push to adopt “best practice” of the other Central Banks. Time will tell. Striking a different tone was ECB President Christine Lagarde, who during today’s ECB press conference was seen to be wearing a necklace that said “in charge”. She certainly is. #financialplanning #financialadvice #permanentwealthpartners #forprofessionalsbyprofessionals

At the start of 2023, we began flagging to our clients the potential for first-rate cuts in Central and Eastern Europe leading Western European counterparts. We currently forecast benchmark rate cuts across Czechia, Hungary, and Poland by the end of 2023, with Romania following in early 2024. These would all be ahead of the European Central Bank pivot expected in June 2024. Although we see varying degrees of reluctance in appearing dovish, easing interest rates and inflationary pressures will drive a growth rebound in these economies relative to regional peers in the eurozone. Read our latest blog to find out which central bank will cut first and the implications for borrowing costs: http://ow.ly/nKTc104PAjn

Interest-rate cuts by the European Central Bank could come as soon as March and will be more significant than markets currently price in, strategists at NatWest Markets write in a note. They expect 100 basis points of ECB rate cuts in 2024, more than the close to 60 basis points priced in by the market. “Even if a March cut does not materialise, we do think that we could see more priced in relative to current market pricing and perhaps in quicker succession,” they write. For the ECB’s meeting on Thursday, NatWest Markets expects the central bank to keep interest rates unchanged, which is in line with the consensus view.

Hungarian central bank close to ending easing cycle after 50bp cut in base rate to 7.25% #bne #bneEditorsPicks #bneChart #Hungary #monetarypolicy #macro The Monetary Council of the National Bank (MNB) reduced the base rate by 50bp to 7.25% at its monthly rate-setting meeting on May 21, in line with forecasts and level with the rate cut a month earlier. The MNB began its easing cycle a year ago from 18%, but it is nearing its end. Inflation is expected to pick up in the coming months after a steep disinflationary period from 25.7% in January 2023 to 3.7% in April 2023, and geopolitical tensions, along with the volatility of international investor sentiment, also justify a cautious monetary policy.