The European Central Bank’s minutes from the December 2019 decision consist of positive comments on its main mandate – there are “mild indications” that core inflation is rising.
The bank is more cautious on the economy as a whole, saying that the data is pointing weak, yet stabilizing growth dynamics. The industrial slump may bottom out before spilling over to the services sector.
It notes that sentiment has improved over receding global trade tensions but that geopolitical tensions are “not conducive” to lowering uncertainty.
Regarding the strategic review, the minutes state that it is advisable not to talk about it until the full document is published.
EUR/USD has responded positively, rising to 1.1170, the highest since January 7.
Back in December, Christine Lagarde, the new President of the ECB, announced that the bank will conduct a strategic review during 2020. She refrained from expressing her views on monetary policy, saying she is neither a hawk nor a dove, but rather aspires to be a wise “owl.”
Back in September, her predecessor Mario Draghi cut interest rates to -0.50% and restarted the bank’s bond-buying scheme. Several Governing Council members from northern countries publicly criticized his moves. Lagarde, who assumed her role in November, aims to unify the institution.