MNI SOURCES: ECB Projections To Include Pricing Since Iran War

The European Central Bank’s March projections to be published this Thursday will use market price assumptions based on values extending into March, in a departure from the original procedure which had placed the cut-off date before the Feb 28 outbreak of the war with Iran, sources from Eurosystem central banks told MNI.

Given the hefty jumps in oil and gas prices and changes in rates pricing since the U.S.-Israeli attack, the macroeconomic projections would have been of little value had the original cut-off date been retained, national central bank officials said. 

“Obviously any original [assumptions] numbers will be as good as meaningless, as they have materially changed-- whether near-term energy prices, rate paths or financial conditions,” one official told MNI. (See MNI SOURCES: Energy Surge Pushes ECB Out Of 'Good Place')

Policymakers had already received a summarised version of the projections, using older market pricing, but these are now out of date, they said. The assumptions include not only energy prices, but also market rate curves, which have all repriced.

An ECB spokesperson declined to comment.