Last week, economists were looking for a 50 bp cut. Today, they have 100 bp priced in as inflation falls sharply. ECB sources tried to tamp down expectations of a larger 50 bp cut though the stunning fall in German inflation last week should open the way for a more aggressive cut. I’m still out on the limb for a 100 bp cut, but its lonely out here.
Also on the wires, The NBER has finally declared the US to be in recession, dating back to December of last year.
