© Reuters. FILE PHOTO: European Central Bank (ECB) headquarters building is seen during sunset in Frankfurt, Germany, January 5, 2022. REUTERS/Kai Pfaffenbach
LONDON (Reuters) – Euro zone money markets were on Thursday pricing in a total of 50 basis points worth of rate hikes from the European Central Bank this year, ratcheting up rate hike bets a day after the Federal Reserve signalled several rate increases ahead.
Money market futures dated to the ECB’s policy meetings showed five, 10 basis point interest rate increases priced in by year-end or a total of 50 bps. That compares with around 44 basis points on Wednesday.
The Fed on Wednesday raised rates for the first time since 2018 and laid out an aggressive plan to push borrowing costs to restrictive levels next year in a pivot from battling the coronavirus pandemic to countering the economic risks posed by excessive inflation and the war in Ukraine.
In early trade, euro area borrowing costs also pushed higher with Germany’s 10-year Bund yield touching 0.408% its highest level since late 2018.
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.
Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.