ECB signals caution on further cuts as euro-area services inflation lingers

The European Central Bank held policy unchanged and pushed back — via careful language — against market pricing for aggressive further cuts. Services inflation in the euro area remains above 3%, and wage growth is only slowly normalizing.

The read-across

A more patient ECB narrows the Fed-ECB rate differential and supports the euro. For gold priced in dollars, that is a modest positive; for gold priced in euros, less so.