The ECB’s first decisions are causing volatile back and forth in the stock and foreign exchange markets. “A trend is not yet recognizable, there are too many questions for that,” comments a trader. The “rate hike light” is not a problem for the markets, since various bond programs and payment buybacks are to continue until 2024. “But the inflation forecast for next year is significantly higher than expected,” says the dealer: The ECB expects inflation of 6.8 percent this year and 3.5 percent in 2023. However, analysts had expected around 6.9 percent and then just under 2.5 percent for the coming year: “Accordingly, a rate hike cycle would then have to run longer. “As a result, bonds, especially 10-year ones, are falling Bonds from Italy give way – their yield jumps to 3.585 percent.
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(END) Dow Jones Newswires
June 09, 2022 08:17 ET (12:17 GMT)