ECB May Hang Firm Even as Eurozone Slows

The European Central Bank's September rate hike remains in the cards despite eurozone GDP growth coming in short of expectations

Eurozone GDP growth fell short of expectations in the second quarter, and the fallout from the U.S. subprime crises has led to continued turbulence in eurozone money markets. Yet comments from central bankers still seem to suggest that the turmoil is being seen through the prism of price readjustment and that the European Central Bank's central scenario has not fundamentally changed. An expected September rate hike to 4.25% is still in the cards.

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