Latest News

ECB to hike rates by 25 basis points in Dec 22 – Deutsche Bank

0
© Reuters. FILE PHOTO: A Deutsche Bank logo adorns a wall at the company’s headquarters in Frankfurt, Germany June 9, 2015. REUTERS/Ralph Orlowski/File Photo

(Reuters) – Deutsche Bank (DE:DBKGn) pulled forward its forecast for a rate hike from the European Central Bank to as soon as December 2022 on Monday, with the German lender saying its latest inflation forecasts showed the bank’s inflation target would be met earlier than expected.

Analysts at the German bank expect the ECB to hike rates by 25 basis-points in as early as December 2022 and by June 2023 at the latest, compared to a previous expectation of 10 bps in December 2023. While this is not a consensus call among analysts, money markets are pricing in nearly two rate hikes from the ECB by end-2022.

Deutsche Bank analysts also accelerated the pace of tightening they expect. The deposit rate, currently at -0.50%, will be hiked 25 bps per quarter until reaching 0.50% in September 2023, they wrote, compared to 10 bps hikes that reached 0% in December 2024 previously.

Less frequent hikes will follow until the ECB reaches a terminal rate at 1% in December 2024, the bank’s analysts wrote, two years earlier than they previously expected.

Expectations of an earlier rate hike also led the analysts to revise up their euro forecast. They now expect the euro at 1.15 against the dollar by the end of the year, compared to 1.08 previously.

ECB to hike rates by 25 basis points in Dec 22 – Deutsche Bank

Disclaimer:Fusion Mediawould like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

Bank of England policymakers before Feb rate meeting

Previous article

Biden to Talk Up Anti-Inflation Efforts as Risks and Prices Rise

Next article

You may also like

Comments

Leave a reply

Your email address will not be published.

More in Latest News