⚡️Eurozone PMI Fall Could Accelerate ECB Rate Cuts
⏺An unexpected fall in the eurozone private sector PMI gave ECB a reason to accelerate interest rate cuts. On Monday, the current situation pushed markets to forecast a rate cut of 43 basis points by the end of the year, instead of the previously expected 38 basis points. At the same time, the probability of another rate cut in October is estimated at 40%.
⏺Following the release of business activity data from S&P Global, a key segment of the German yield curve normalized and the euro weakened. Today's PMI data adds to concerns about growth and increases the likelihood of another contraction in October. Eurozone economic performance continues to deteriorate, especially in Germany. Germany's business activity index fell to 48.9 in September, which is below the predicted 50.5.
⏺Some ECB policymakers have warned that rates that are too high could harm the economy. Eurozone inflation data for September and Ifo's monthly survey on the German economy will be important for decision-making at the next ECB meeting. Speculation about faster easing has also intensified due to the US Federal Reserve's move to cut rates despite the US economy continuing to expand.
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⏺An unexpected fall in the eurozone private sector PMI gave ECB a reason to accelerate interest rate cuts. On Monday, the current situation pushed markets to forecast a rate cut of 43 basis points by the end of the year, instead of the previously expected 38 basis points. At the same time, the probability of another rate cut in October is estimated at 40%.
⏺Following the release of business activity data from S&P Global, a key segment of the German yield curve normalized and the euro weakened. Today's PMI data adds to concerns about growth and increases the likelihood of another contraction in October. Eurozone economic performance continues to deteriorate, especially in Germany. Germany's business activity index fell to 48.9 in September, which is below the predicted 50.5.
⏺Some ECB policymakers have warned that rates that are too high could harm the economy. Eurozone inflation data for September and Ifo's monthly survey on the German economy will be important for decision-making at the next ECB meeting. Speculation about faster easing has also intensified due to the US Federal Reserve's move to cut rates despite the US economy continuing to expand.
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