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ECB Cheat Sheet: Start and stop
We look at different scenarios ahead of this Thursday’s ECB announcement. With expectations firmly centred on a 25bp rate cut, most of the focus will be on comments on inflation and future easing. A “hawkish cut” may provide some support to the eurozone yields, but the next big move in EUR/USD should still be caused by US macro developments. In rates markets, a cut by the European Central Bank on Thursday is already fully baked into the curve, with forward pricing nearly 25bp. But it's the outlook beyond June that is still open, despite communication from officials having started to move out the curve. A ... (full story)