- This topic has 2 replies, 2 voices, and was last updated 10 months ago by Helmholtz Watson.
- 17 May '22 at 6:43 am #36891Helmholtz WatsonParticipant
A top European Central Bank official has raised the prospect of a half percentage point rate increase in July. Dutch central bank chief Klaas Knot sai
[See the full post at: Dutch Central Bank Chief First ECB Governor To Raise Prospect of 50Bps Rate Rise]17 May '22 at 12:08 pm #36913TradersComKeymaster
Deutsche Bank writes the move might have been made to support the currency.
“It has been clear for a while that the ECB are not happy with the FX markets and the rhetoric of endorsing hikes from July onwards has had minimal response in spot. Today, with Knot opening that door, we have seen the currency respond,” DB writes.
Economists at Deutsche Bank see 50 basis point hikes in July and September, noting that Villeroy has been pointing to 1-2% as the range of neutral and they want to get there.
They highlight the next round of CPI numbers as pivotal and expect a lively 25 vs 50 bps debate to develop.
25 May '22 at 8:23 am #37374Helmholtz WatsonParticipant
- This reply was modified 10 months, 1 week ago by TradersCom.
ECB’s Knot: Inflation expectations are at the upper limit of being well-anchored
There are still two more inflation readings before the July meeting
A 50 bps rate hike isn’t off the table
Rate hike will only be on the table in July, not June
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