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Major forecasts: Back to work
We look for more tightening from both the Fed and the ECB, but now actually expect the ECB to stop its hikes before the Fed. Longer yields still have some upside left, while EUR/USD could experience a dip before rising further. The Fed paused its rate hiking cycle and while the ECB pushed forward with another 25bp rate increase, the tone of the statement softened somewhat. At the same time, some central banks, the Bank of Canada being the latest one, have resumed hiking rates after earlier pauses because inflation has remained surprisingly high. We think both the Fed and the ECB will hike rates again in July and risk ... (full story)