IMF Sees the ECB Raising Rates at Least Once More This Year, Ahead of Its October 29 Decision
The International Monetary Fund said on Friday that the European Central Bank is likely to raise interest rates by 25 basis points at least once more this year to contain inflation pressure. The ECB's next policy decision is scheduled for October 29, immediately after the Federal Reserve's October 27-28 meeting, putting the world's two most influential central banks on stage in the same week.
Energy is the shared variable in the inflation backdrop: Brent crude briefly climbed above $110 a barrel on Friday, its highest since May, and U.S. import prices rose 8.1% year over year in September, with fuel import prices up 34.5%. Europe faces the same energy cost pass-through.
Currency markets moved first. The euro slipped 0.1% to about $1.1225 in Asian trading on Monday, while domestic protests and budget uncertainty in France kept the spread between French and German government bonds near 140 basis points. Analysts at InTouch Capital Markets said positioning is likely to stay light this week, with headline risk out of France remaining high.
For the United States, CME FedWatch pricing implies roughly an 84% probability that the Fed stays on hold at its October meeting, while the odds of a December hike have risen to around 90%, between 89% and 92% depending on the snapshot.
Published by GSM · USA (original Chinese edition)
Photo: 图：欧洲央行所在地法兰克福的天际线。照片：Flocci Nivis，CC BY 4.0，经 Wikimedia Commons。/ Photo: The Frankfurt skyline, home of the European Central Bank. Photo by Flocci Nivis, CC BY 4.0, via Wikimedia Commons.
