Alexander Glas and Julius Schölkopf (July 2024)

How Much Do Financial Analysts Disagree on the Future Path of the ECB’s Interest Rate?

In this policy brief, we analyze whether and how much professional forecasters and market analysts disagree on the nature and speed of future interest rate decisions by the ECB. We also consider the role of uncertain dynamics of future inflation and the economic recovery in the euro area to explain the dispersion of interest rate expectations. For this purpose, we asked the participants in the June 2024 wave of the ZEW’s Financial Market Survey for their expectations regarding interest rate decisions at upcoming Governing Council meetings. We condition the individual responses on the respondents’ short- and medium-term inflation and GDP growth expectations and supplement our findings with similar evidence for the US. 

Media Coverage: Christian Siedenbiedel discussed the policy brief in the Frankfurter Allgemeine Zeitung (one of Germany’s leading economic newspapers) on July 9 (“Das große Zins-Szenario”) and cited our policy brief for commenting on the ECB’s Governing Council meeting on July 18. Moreover, ntv, Tagesschau, and also cited our study: 

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