ECB’s crucial 2024 projection to put inflation above 3%

Reuters scored two major victories in its reporting this week of the European Central Bank’s cliff-hanger interest rate meeting. First, on the eve of the meeting, it exclusively reported that the ECB would revise upwards its inflation forecasts, acknowledging that inflation would remain above 3% next year – well above target. That was seized on by financial markets who on Wednesday starting reversing their bets that policy-makers would keep rates on hold and instead put their money on there being a further 25-basis point hike. When both the inflation forecast revision and the rate hike were finally confirmed on Thursday, Reuters was first yet again to report key details of the ECB’s written statement – winning the first snap on the rate move by one full second and also ahead on the ECB’s carefully worded message that it believed rates were now at sufficiently restrictive levels to tame inflation – the component of the statement which drove eurozone bond yields lower and European shares higher.