Soc Gen on the European Central Bank vs. the Federal Reserve:
- The case for higher terminal rates is clearer for the ECB than elsewhere
- we expect a further 125bp of hikes
- and upside risks to wages could materialize
With the case for higher terminal rates clearer for the European Central Bank than for the U.S. Federal Reserve, and thus more interest-rate rises by the ECB than the Fed ahead, SG see U.S. Treasurys outperforming German Bunds.