ECB MINUTES SUMMARY: Stale account reaffirms that ECB remains in wait-and-see mode

Given that the meeting itself passed with little in the way of fanfare, the account of the meeting was never going to produce much in the way of fireworks. In terms of the key takeaways, the latest developments in economic activity and inflation were seen as being consistent with the current monetary policy stance. More specifically, there had been further progress on all three elements of the reaction function, which gave grounds to be confident that monetary policy was working. That being said, It was affirmed that further progress needed to be made in the disinflationary process before the Governing Council could be sufficiently confident that inflation was set to hit the ECB’s target in a timely manner and in a sustainable way. Accordingly, members signalled that continuity, caution and patience were still needed, since the disinflationary process remained fragile and letting up too early could undo some of the progress made. More specifically when it came to the prospect of lowering rates, the risk of cutting policy rates too early was still seen as outweighing that of cutting rates too late. Overall, the account provided little in the way of fresh insight with the Governing Council in "wait-and-see" mode as policymakers await further progress in their battle against inflation.