The article critiques the European Central Bank's (ECB) recent policy statement, which remains largely unchanged from December, emphasizing terms like 'meeting-by-meeting' and 'data-dependent.' Market reactions to the press conference appear irrational, as investors have not been convinced of a more hawkish stance. The ECB maintains an optimistic outlook regarding falling wages leading to increased consumption, yet historical delays in recovery and low confidence among consumers cast doubt on this forecast. Concerns about tariff risks and potential rate cuts suggest an uncertain economic landscape ahead.
The ECB is clinging on to the optimism that falling rates and rising real wages will translate into a rebound in private consumption.
The recovery has been repeatedly delayed, and it is hard to imagine that this turns around in the near term.
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