Recession Required for Rate Cuts
by AIB Treasury Economic Research Unit
- Markets are of the view that we have seen the last ECB rate hike, following Thursday’s 25bps increase, which brought the key deposit rate up to 4%.
- As the ECB notes, though, the risks to its growth forecasts are tilted to the downside.
- The available hard data for Q3 have also been weak.
- The ECB expects activity to pick up momentum as real incomes rise on the back off falling inflation, higher wages and a strong labour market.
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