ECB deposit rate to reach 3.25% In Q2 – Reuters poll

Dhwani Mehta FXStreet

According to the latest Reuters poll of economists, the European Central Bank (ECB) is seen raising rates by another 50 basis points (bps) at its February monetary policy meeting while the policy rate is expected to reach 3.25% by mid-year.

Additional takeaways

They are likely to follow that up with another 50 basis point lift in March.

The central bank will then add 25 basis points next quarter before pausing, giving a terminal rate in the current cycle of 3.25%, its highest since late 2008.

In December's poll, the rate was put at 2.50% at end-March and was seen topping out at 2.75%.

Inflation will average 6.0% this year and 2.5% next but will be 2.0% across 2025.

The economy was now expected to grow 0.1% next quarter rather than a flatline. It is forecast to expand 0.3% in the following two quarters.

Related reads

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

GBP/USD advances above 1.3500 as easing Fed hike bets down USD

GBP/USD extends the advance above 1.3500 in the European trading hours on Friday. The US Dollar drops against the British Pound as cooler-than-expected US consumer and producer inflation data have limited the Fed's room for further interest rate hikes. Traders will keep an eye on the US July Retail Sales report and the Consumer Sentiment data later this Friday.

EUR/USD climbs above 1.1550 as US Dollar slips ahead of data

EUR/USD gains traction in the European session on Friday and trades in positive territory above 1.1550. The pair capitalizes on renewed US Dollar weakness, as doubts over a September Fed rate hike offset lingering Middle East concerns. The US Retail Sales and UoM Consumer Sentiment data are in focus later in the day. Meanwhile, the data from the Eurozone showed that the Gross Domestic Product (GDP) expanded at an annual rate of 1% in the second quarter, as expected.

Gold sticks to losses but holds above $4,300 as reduced Fed hike bets weigh on USD

Gold recovers slightly from the $4,300 neighborhood heading into the European session, though it remains in negative territory for the second straight day. Moreover, a mixed fundamental backdrop warrants some caution before positioning for an extension of the retracement slide from $4,450, or the highest since June 5, set the previous day.

Bitcoin SV hits three-month high, eyeing 200-day EMA breakout

Bitcoin SV is up nearly 2% extending a steady upward trend over the last two weeks. Retail strength builds in BSV amid multiple vulnerabilities found in the Bitcoin ecosystem. Bitcoin SV’s technical outlook is bullish as the price tests an upside breakout above the 200-day Exponential Moving Average at $15.39.

UoM Consumer Sentiment Index set to ease as inflation, labour market worries loom

The University of Michigan will release the preliminary estimate of August’s Consumer Sentiment Index on Friday. US consumers’ confidence is expected to have ticked down to 54.5 in August from 55.2 in July, as measured by the UoM Consumer Sentiment Index.

Why is Crude Oil priced for a reopening the ships haven't made?

Fourteen vessels crossed the Strait of Hormuz on Tuesday. Before the war, the count ran near 120 a day. In the sessions since the waterway was publicly declared open, Brent has drifted back to $87 and West Texas Intermediate (WTI) to $81, both a little lower again on Wednesday, with daily momentum on each unwound from the top of its range in late July to the low twenties now.