The markets start to imagine their news -Report from the press conference at the EZB- from Thomas Seidel

Mario Draghi (center)
(Source: Thomas Seidel)

The ECB Executive Board did not make substantive new decisions at its meeting today. The subsequent press conference, however, reveals a new trend. Where there are no news, the markets are increasingly making themselves some. This can not last long.

The European Central Bank (ECB) produces boredom. And that for over 15 months. The central bank does not change its decisions at the core. So the key interest rates remain unchanged. The government bond purchase program has been cut, but it remains. Otherwise there are no signs of change. This also applies to inflation. The goal of the ECB, just under 2 percent is not reached. So nothing changes. Only the economy, Mario Draghi admits, is growing well but unexpectedly.

This ECB course was adopted in autumn 2016. The background was the European election year 2017. Polls took place in the Netherlands, France, Germany and Austria. The contribution of the ECB was, to provide liquidity to the banks and the economy and to calm the markets. Whatever the outcome, at the end of 2017, new governments were expected in all these countries. In all these countries? Ironically, economically and politically so important Germany has four months after the election to the Bundestag no new stable government. The prospects to get one in such a short time are bad. Starting now with a turnaround in the monetary policy of the ECB seems to be too great a political risk.

However, this is apparently too boring for some market participants. If even the central bank announces no news, then you make yourself seemingly what. Earlier statements are quoted and reinterpreted. You try to put words in the mouth of decision-makers. Suddenly, it's no longer about fundamental economic data that is at the center of interest, but how language is used.

Mario Draghi has his hands full today to stress how much the ECB adheres to its own rules. Even absurd coherences are questioned. How the ECB sees developments in the exchange rates of the EURO? Clear answer from the President, exchange rates are not a goal of the European Central Bank. This is what others are talking about, not the ECB.

In the end, however, there is a damper for all lovers of news. Draghi said, there would be little chance of a rate hike this year.

One wonders which bored market participants necessarily want to talk about a change in the conditions at the ECB. Are they bored analysts or economists? Are they perhaps speculators or stupid people wasting time? Are they national politicians who simply do not want to understand the necesssaties of a supranational institution? Whoever thinks he has to force decisions on monetary policy should qualify professionally and try to become a member of the ECB Executive Board. All others have to stay outside.