0538 GMT - The European Central Bank is moving to recalibrate rates preemptively in the absence of a solution to reopen the Strait of Hormuz, Neuberger's Patrick Barbe says in a note. A rate hike on Thursday is justified by energy prices having reached levels embedded in the ECB's adverse scenario, the senior portfolio manager says. The ECB's view is that prolonged high energy prices make a certain degree of indirect inflation diffusion inevitable. For the time being, core inflation has stabilized in the wake of service inflation showing weak activity and high interest rates weighing on consumption and real estate, he adds. Money markets are pricing in a 95% probability of a 25-basis-point rate hike by the ECB, according to LSEG data.
At the request of the copyright holder, you need to log in to view this content
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.