Voting rotation, hawkishness and the next ECB meeting in sight

The ECB prepares to hold its first rate-setting meeting for 2023 on February 2. The market is almost certain that another 50 bps rate hike will be announced next week. The attention falls on the ECB outlook as an open debate among the ECB members is developing before our eyes. Both sides have sound arguments with the doves regaining strength following the recent easing in both the inflation rates and commodity prices. But who has the upper hand at the February meeting?

Voting rotation in place

Similar to the Fed, the ECB has adopted a voting rotation since January 1, 2015 as the euro area countries exceeded a predefined number of 18. Contrary to the Fed where specific members are voting for the entire calendar year, the ECB is enforcing a monthly voting rotation.

In more detail, the six members of the governing council vote every month, a situation similar to the Fed’s voting system. The 20 eurozone countries are then split in to two groups. The first group consisting of Germany, France, Italy, Spain and the Netherlands share four votes every month. In practice, one representative of the aforementioned countries will not vote each month. The remaining 15 countries share just 11 votes. In total, there are only 21 votes to be cast each month if there is a policy meeting scheduled. Naturally, all ECB members take part in the discussions and deliberations at the meetings.

The usual hawks-doves division

The ECB members have been traditionally separated to hawks and doves based on their opinions on both monetary policy and the overall eurozone economic outlook. The group of hawks advocates for a more aggressive stance, it is historically led by the Bundesbank governor and it encompasses most governors of the northern eurozone countries. On the other hand, doves are the ECB members that tend to support a looser approach, especially at this juncture that the Fed prepares to press the brakes on further rate hikes. Traditionally, the governors coming from the European South belong to this dovish camp. Chart 1 below shows our estimation of the hawkishness and dovishness of the 26 ECB members based on their recent commentary.

Hawkishness per month

Based on the perceived hawkishness of the ECB members, we have gone a step further and calculated the relative hawkishness/dovishness of the voting members for each month – presented at Chart 2 below.  We have colour-coded the eight rate-setting meeting set for 2023. Interestingly, the most hawkish voting stance comes at the October meeting that is scheduled to be held in Athens, Greece. Traditionally, the ECB tends to avoid making significant announcements away from Frankfurt, unless there is a crisis in the market.

What does this mean for the February 2 meeting?

The February meeting records the second highest hawkish voting stance in 2023. This potentially means that an attempt by the ECB doves to gain the upper hand at the meeting and disproportionately influence the decision-making process could be blocked by the hawks. Based on recent comments by notable hawks, they do not appear to have shifted their stance regarding the next rate hikes despite the recent improved economic data releases. This could also mean that any dovish market expectations going into the meeting could potentially face a difficult time. Despite the recent market sentiment favouring the euro, the overall positioning in the market appears to be more dollar positive. On face value, this situation increases the chances for a more sizeable move next week if the ECB manages to present a more hawkish stance than anticipated, and hence disappoint the euro doves. Similarly, the recent dip in yields could be reversed after the meeting, especially if on February 1 chairman Powell fails to meet the dovish Fed expectations. To sum up, the market focus next week will almost entirely fall on the overall language of the ECB statement and the usual press conference by president Lagarde.

면책조항: XM Group 회사는 체결 전용 서비스와 온라인 거래 플랫폼에 대한 접근을 제공하여, 개인이 웹사이트에서 또는 웹사이트를 통해 이용 가능한 콘텐츠를 보거나 사용할 수 있도록 허용합니다. 이에 대해 변경하거나 확장할 의도는 없습니다. 이러한 접근 및 사용에는 다음 사항이 항상 적용됩니다: (i) 이용 약관, (ii) 위험 경고, (iii) 완전 면책조항. 따라서, 이러한 콘텐츠는 일반적인 정보에 불과합니다. 특히, 온라인 거래 플랫폼의 콘텐츠는 금융 시장에서의 거래에 대한 권유나 제안이 아닙니다. 금융 시장에서의 거래는 자본에 상당한 위험을 수반합니다.

온라인 거래 플랫폼에 공개된 모든 자료는 교육/정보 목적으로만 제공되며, 금융, 투자세 또는 거래 조언 및 권고, 거래 가격 기록, 금융 상품 또는 원치 않는 금융 프로모션의 거래 제안 또는 권유를 포함하지 않으며, 포함해서도 안됩니다.

이 웹사이트에 포함된 모든 의견, 뉴스, 리서치, 분석, 가격, 기타 정보 또는 제3자 사이트에 대한 링크와 같이 XM이 준비하는 콘텐츠 뿐만 아니라, 제3자 콘텐츠는 일반 시장 논평으로서 "현재" 기준으로 제공되며, 투자 조언으로 여겨지지 않습니다. 모든 콘텐츠가 투자 리서치로 해석되는 경우, 투자 리서치의 독립성을 촉진하기 위해 고안된 법적 요건에 따라 콘텐츠가 의도되지 않았으며, 준비되지 않았다는 점을 인지하고 동의해야 합니다. 따라서, 관련 법률 및 규정에 따른 마케팅 커뮤니케이션이라고 간주됩니다. 여기에서 접근할 수 있는 앞서 언급한 정보에 대한 비독립 투자 리서치 및 위험 경고 알림을 읽고, 이해하시기 바랍니다.

우리는 웹사이트에서 최고의 경험을 전해드리기 위해 쿠키를 사용하고 있습니다. 자세히 읽거나 쿠키 설정을 변경하세요.

리스크 경고: 고객님의 자본이 위험에 노출 될 수 있습니다. 레버리지 상품은 모든 분들에게 적합하지 않을수 있습니다. 당사의 리스크 공시를 참고하시기 바랍니다.