Ahead of the key interest rate decision in the Eurozone, there is restraint and caution on the German stock market. After the DAX’s seven-day record run until the end of last week, investors became more cautious. In early business it fell by 0.40 percent to 17,646.59 points. On Friday, the Dax had reached its highest level to date at just over 17,800 points.
Ahead of the key interest rate decision in the Eurozone, there is restraint and caution on the German stock market. After the DAX’s seven-day record run until the end of last week, investors became more cautious. In early business it fell by 0.40 percent to 17,646.59 points. On Friday, the Dax had reached its highest level to date at just over 17,800 points.
The MDax, the index of medium-sized companies, lost 0.75 percent to 25,963.16 points shortly after the start of trading. The Eurozone leading index EuroStoxx 50 fell by 0.30 percent to 4900.75 points.
“It’s ECB day again,” said portfolio manager Thomas Altmann from QC Partners. It is considered impossible that the European Central Bank (ECB) will touch its key interest rate, but the meeting is still important for the capital markets. The updated forecasts for growth and inflation in the Eurozone are likely to receive particular attention, as they can be used to determine whether the currently priced-in first interest rate cut in June is a realistic option for the ECB. Equally significant was ECB President Christine Lagarde’s choice of words during the press conference.
The central bank will probably keep the key interest rate unchanged for the fourth time in a row, after having raised it quickly and significantly to the current level by September last year due to the sharp rise in inflation. Since then, the ECB has remained silent, while the big question is when interest rates will fall again.
In the USA, Fed Chairman Jerome Powell had confirmed just the day before that there was no hurry to cut interest rates. First there needs to be more confidence that inflation will continue to decline permanently. This was enough for the US stock market to end the trading day on Wednesday with moderate gains.
Source: Stern
