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Real-time News
April 27th - A survey of businesses access to financing released by the European Central Bank (ECB) on Monday showed that, affected by the war in Iran, eurozone businesses expect short-term inflation to rise, but long-term expectations remain stable, and wage growth expectations are actually slowing. The survey, covering over 10,000 businesses, including both pre- and post-war responses, showed no signs of a second wave of inflation, easing some concerns ahead of Thursdays meeting. The ECB stated that one-year inflation expectations jumped to 3.0% from 2.6% three months ago, while three- and five-year inflation expectations remained unchanged. Businesses did not raise their wage expectations; instead, they reported a slowdown in wage growth expectations. The ECB stated, "The Middle East war has significantly increased businesses expectations for selling prices and input costs, but has not affected wage expectations." The survey showed that wages are expected to grow by 2.8%, down from 3.1% three months ago. Businesses expect selling prices to rise by 3.5%, while input costs, including energy, are expected to rise by 5.8%.The European Central Banks survey on corporate financing channels shows that short-term inflation expectations have risen significantly, while medium-term expectations remain stable. Businesses anticipate the Iran war will drive a sharp increase in sales prices, but wage expectations have weakened slightly.The ECBs survey on corporate financing channels indicates that companies report further tightening of bank lending rates and other lending conditions; corporate profits continue to deteriorate.On April 27th, European Central Bank (ECB) policymakers made it clear that they value maintaining flexibility in policy options ahead of this weeks policy decision. The market has reacted accordingly, lowering its rate hike expectations to approximately 20%. However, this probability is expected to rise to around 63% by the June meeting. Looking at the full year, traders are currently pricing in a rate hike of approximately 58 basis points, roughly equivalent to two subsequent 25 basis point hikes, which is Goldman Sachs current baseline scenario. Goldman Sachs believes that given the unresolved situation in the Middle East, the ECB is unlikely to take action this week, as policymakers want to preserve policy space while assessing the second-round effects of inflation. The press conference is expected to maintain the tone of recent communications, with ECB President Lagarde potentially stating that the Governing Council will monitor the second-round effects and is prepared to act to ensure inflation returns to 2% in the medium term. Regarding the future policy path, Goldman Sachs expects the ECB to implement two 25 basis point rate hikes in the coming months, the first in June, followed by a move to raise the deposit rate to 2.50% in September.On April 27th, at the 2026 Beijing International Automotive Exhibition, Unisoc and ADAYO jointly released a new generation AI cockpit platform equipped with the A8880 chip, which achieves a significant leap in CPU, GPU computing power and graphics rendering capabilities.
