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Investing.com -- The decision on whether to lower interest rates in April is still being debated by multiple officials from the European Central Bank (ECB), Bloomberg reported Monday citing sources familiar with the matter. The sources, who wished to remain anonymous due to the confidential nature of the discussions, indicated that the upcoming meeting is not as predictable as investors might believe.
Investors are currently pricing in an over 80% probability that borrowing costs will be reduced once more on April 17. However, ECB officials, representing a range of views on monetary policy, are considering the possibility of a pause. This contemplation comes amidst an environment of increased uncertainty due to US President Donald Trump’s trade policies and a rise in military spending across Europe.
While officials with a more dovish outlook still see the necessity for further easing of monetary policy, they might not demand a seventh reduction since June, if their more hawkish counterparts request additional time to evaluate economic data. The sources did emphasize that the meeting is still two and a half weeks away, and the prevailing line of thinking could change in that time.
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