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Account of the monetary policy meeting of the Governing Council of the European Central Bank held in Frankfurt am Main on Wednesday and Thursday, 14-15 June 2023
13 July 2023
1. Review of financial, economic and monetary developments and policy options
Financial market developments
Ms Schnabel noted that, since the Governing Council’s previous monetary policy meeting on 3-4 May 2023, the narrative in financial markets had shifted from global tail risks – emanating from the banking sector tensions and the US debt ceiling debate – towards concerns about a deterioration in the euro area macroeconomic outlook and more persistent core inflation pressures globally.
Global market conditions had further normalised as tail risks to the economy had subsided. Volatility in financial markets had decreased notably across market segments and countries, suggesting that risks of systemic stress were currently contained. Stock market implied volatility in the United States, as measured by the…