Rabobank maintains its forecast for a 25bps ECB rate hike next week; expects the ECB to raise rates by another 25bps, likely in September
- Expects the ECB will materially raise its inflation projections while growth may be weaker than in the central bank's March forecasts.
- "The conflict in the Middle East is still ongoing, and risks of inaction are now greater than the risks of potentially hiking in error."
- "Our own inflation forecasts suggest that the ECB will revise its own inflation projections up significantly, while the growth may be weaker than ECB staff projected in March."
- "We therefore expect that the ECB will opt for a couple of risk-management hikes, but we do not expect a full-blown hiking cycle."
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