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Week Ahead – ECB headed towards another cut, CPI on the agenda elsewhere
Following the RBNZ, which cut interest rates by 50 basis points this Wednesday, the central bank torch will be passed next week to the ECB. Although last time, President Lagarde and her colleagues did not back an October rate cut, their stance started to shift following the disappointing PMIs and the slide in headline inflation below 2%, prompting market participants to increase bets of such an action. Currently, investors are nearly fully pricing in a quarter-point reduction at Thursday’s gathering, while expecting another one in December. Thus, a quarter-point reduction on its own is unlikely to shake the euro, ... (full story)