ECB rate hike for next year is slowly being priced out

Author: Justin Low | Category: News

Expectations for a rate hike next year is being scaled back

Eurozone money market futures are now pricing in a ~60% probability for the ECB to hike rates next year and that is a heavy drop from the ~75% probability seen yesterday after the ECB meeting. Draghi was dovish but he still stuck to the script for the most part, though there were suggestions that the ECB wanted to change the risk assessment to reflect more "downside".

If anything, the latest data here will warrant for further caution and it could mean we may see the ECB take a step back early next year from the current forward guidance should weak economic data persist.
ForexLive


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