Traders Step Up ECB Rate-Cut Bets on Bleaker Economic Outlook
- Bonds gain, 10-year yield falls lowest in over a month
- Traders price around one percentage point of cuts in 2024
European Central Bank headquarters in Frankfurt, Germany.
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Traders are betting on bigger interest-rate cuts from the European Central Bank this year after policymakers outlined a bleaker economic outlook for the euro area in their latest forecasts.
Money markets are betting on about four quarter-point reductions by the end of the year, with a first cut almost fully priced by June. Before the meeting, wagers were on three cuts, with a 72% chance of a fourth.