The Paris Stock Exchange fell slightly after the announcement by the European Central Bank of an unprecedented increase of 75 basis points in its key rates. The “refi” rate thus goes from 0.5% to 1.25%, that of marginal lending facilities from 0.75% to 1.5% and that of deposit facilities from 0% to 0.75%. This increase in the cost of money comes after the 0.5% increase decided in July, which was the first since 2011. In its press release, the ECB also indicates that it has raised its inflation forecast to 8.1% for 2022. , against 6.8% estimated in June, from 3.5% to 5.5% for 2023 and from 2.1% to 2.3% for 2024. Christine Lagarde will hold her traditional press conference following the meeting of the Board of Governors at 2:45 p.m. On the foreign exchange market, the euro is moving around parity against the dollar after hitting a 20-year low on Tuesday at 0.9864.
Shortly before 2:30 p.m., the Bedroom 40 is stable at 6,104.81 points (-0.2%) after a peak at 6,143.29 (+0.61%), in a business volume of 880 million euros. The contracts future on American indices show a slight decline the day after their best session in almost a month, the Nasdaq having for its part ended its longest bearish series since the end of 2016.
Jerome Powell to follow…
The inflation rate reached a new high of 9.1% over one year in August in the euro zone, thus increasing the pressure on the ECB. Gas prices have soared by around 50% since the last ECB meeting, and this surge should affect many sectors of activity as well as households by contagion, which increases the risk of recession.
A reaction deemed too timorous would have had the effect of strengthening long-term inflation expectations and undermining the credibility of the ECB, whose primary mission is to guarantee price stability.
Across the Atlantic, Jerome Powell could give this Thursday indications on the extent of the next tightening of the Fed, expected on September 21, as part of a debate on monetary policy organized by the Cato Institute in Washington. The market expects Fed funds rates to rise by 75 basis points. Two other Fed officials, Charles Evans, president of the Chicago branch, and Neel Kashkari, a colleague from the Minneapolis branch, are also scheduled to speak in the evening.
Atos degraded, Carrefour “poorly valued”
The values called “value” are surrounded likeAxa (+2.1%).
Crossroads garners 1.3%. Barclays reiterated its recommendation to “overweight” the title of the distribution group to aim for 22 euros.
Conversely, Atos plunged 15.5%. Goldman Sachs downgraded the value from “neutral” to “sell” and reduced its price target from 23 to 8 euros. Publicis takes for its part 1.3% while Redburn has taken over the coverage of the advertising group, which judges “poorly valued”, to “purchase”.