Technical Analysis

ECB’s Wunsch: ECB will not go from 50 bps in March to no rate hike in May

  • A 25 bps or 50 bps rate hike in May is possible
  • If core inflation remains persistent, 3.50% terminal rate is the minimum
  • Thursday decision is a hawkish one so market reaction has been surprising

Well, they are really coming out to make it clear to markets that March isn’t going to be the last rate hike in this tightening cycle. I think the issue for me is why couldn’t we just hear something like this from Lagarde yesterday? Geez.

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