Markets unlikely to price ECB rate hikes for the next 12 months - Danske Bank

"We have cut our yield forecasts a little further," announced Danske Bank research team. "We are now even more certain that both short-term and long-term yields are set to stay low for the rest of 2019 and far into 2020."

Key quotes

"We have pushed back our call for the next ECB rate hike (policy rate currently at -0.40%) from H2 20 to early 2022. As such, we no longer expect the fixed income market to price rate hikes during H1 20."

"As a result, we expect German Bund yields to trade at close to zero for the next 12 months. Risk appetite will be the main determinant of yield levels. Due to the trade conflict, risk aversion is currently high, but we expect it to subside slightly on a 12-month horizon. We expect 10Y Bund yields at 0.15% (0.30%) 12 months from now. "

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility.

Feed news

Latest Forex News

Editors’ Picks

EUR/USD depressed around 1.1260 as recovery loses steam

The EUR/USD pair attempted to recover some ground but lost momentum around 1.1280, now near daily lows. Majors confined to tight intraday ranges amid a limited macroeconomic calendar, central banks’ pessimism. 


GBP/USD accelerates decline after losing the 1.2550 level

The Sterling is among the weakest currencies, undermined by Brexit turmoil. GBP/USD extends decline to fresh daily lows. Dollar still down against most major rivals. 


USD/JPY: unable to recoup the 108.00 level

Mixed Chinese data fell short of spooking growth concerns, Q2 GDP at 27 years low. Quiet macroeconomic start to the week in Europe and the US. USD/JPY short-term bearish as long as it remains below the 108.30 level.


Gold erases daily upside, sits comfortably above $1400

Despite a drop below the critical handle of $1400 last week, the troy ounce of the precious metal closed at $1415 but failed to push higher on Monday. As of writing, the XAU/USD pair was trading at $1410, losing nearly $5 on a daily basis.

Gold News

Forex Today: USD attempts a comeback, China growth slows, and Bitcoin recovers

The Chinese economy grew by 6.2% y/y in Q2, the weakest expansion in 27 years. Activity data showed a dramatic improvement, Antipodeans advanced further, Asian stocks traded mixed.

Read more