A huge day coming for EUR: ECB rate hike, Italian political turmoil, Gas to flow (recuted)

The European Central Bank will be raising rates tonight. Expectations are roughly split on a 25bp or 50bp hike. Of even more interest though will be details of the Bank’s proposed anti-fragmentation tool:

  • this is intended to support vulnerable peripheral government bond markets (Italy, for example) – i.e limiting peripheral yield spikes (i.e. peripheral bond sell-offs)

ECB announcement is due at 1215 GMT (note the new scheduled times)

  • press conference follows at 1245 GMT
  • for previews, see under the chart below

Also coming up Thursday 21 July 2022, Italian politics

  • Draghi to announce his resignation in the Chamber tomorrow

And, Nordstream flows are expected to recommence, but in a limited state (I’ve seen credible forecasters tipping as low as 20% of capacity):

  • Germany gas transportation company says it assumes Nord Stream will return at 40%
  • Goldman Sachs reiterates its view that Russia will return gas to Nordstream at just 40%
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