The ECB took another step towards a rate cut in June, even though it does not want to pre-commit to any specific rate path. Financial markets took the message in a slight dovish light. We keep our baseline of cuts in June, September and December. The ECB expectedly left rates unchanged but gave clear signals that barring big surprises in data, rates will be cut in June. If the Governing Council’s updated assessment of the inflation outlook, the dynamics of underlying inflation and the strength of monetary policy transmission were to further increase its confidence that inflation is converging to the target in a ... (full story)