wire service; focuses on market impact and what 'framework guidance' means for rate-cut timing bets; notes that ECB watchers interpret the shift as a signal that any further easing will be slower and more conditional than previously expected

Reports that German Bund yields rose 8 basis points and the euro strengthened 0.4% against the dollar after the speech as markets unwound bets on three ECB cuts before year-end. ECB sources told Reuters the 'framework guidance' terminology was deliberately chosen to remove any implied promise on the rate path, a lesson from the ECB's 2021-22 communication failures.

“Lagarde said the ECB had 'returned to basics', signalling rates would remain the sole tool and that the bank would not pre-commit to a future path for cuts.”