ECB's Villeroy says disinflation is even faster than anticipated. Data supports the ECB's view of a return to 2% inflation. Absent any shocks, rate hikes are over.
- Can look at rate cuts when the time comes in 2024.
Reaction details (14:40)
- Commentary which has sparked, in a slightly belated reaction, pressure in the EUR and upside in EGBs.
Specifically:
-
Bund Dec'23 lifted from 132.50 to 132.71 over the course of three minutes, thereafter to 132.76; with particular momentum emanating after the rate hikes are over, absent any shock remark. -
EUR/USD fell from 1.0868 to 1.0852 over the same time period; thereafter, EUR/USD sunk to a 1.0840 session trough. - Additionally, markets now fully price in 125bps worth of cuts from the ECB in 2024.
Analysis details (14:39)
- Follows the recent cooler-than-expected inflation metrics for November.
01 Dec 2023 - 14:39- Fixed IncomeImportant- Source: Newswires
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