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UK Inflation was not dead after all
Interest rates have rebounded sharply the last couple of weeks against a backdrop of generally stronger economic data, higher inflation (both actual readings and expectations) coupled with more hawkish comments from several fed members. A more constructive and optimistic discussion on raising the debt ceiling between US politicians has also helped. Markets are now back to pricing in one more hike this summer and a much reduced pace of rate cuts this fall. Fed Funds are now expected to end the year at 5%, up a full percentage point from mid-March and 75bps higher from just 3 weeks back. We never agreed with the rapid ... (full story)