Euro: ECB guidance may trigger asymmetric downside risks - Commerzbank
Commerzbank’s Antje Praefcke notes that markets are fully pricing an European Central Bank (ECB) rate hike next week after Euro Area inflation rose to 3.3%, but she doubts further tightening beyond September as projections show inflation declining into 2027.
Commerzbank's Antje Praefcke observes markets have fully priced an upcoming European Central Bank (ECB) rate hike next week following a rise in Euro Area inflation to 3.3% in August. However, she expresses skepticism about further tightening beyond September as projections indicate inflation declining into 2027. Praefcke argues EUR upside is limited and warns of asymmetric downside risks if the ECB signals an end to its hiking cycle.
She believes the euro's gains will be more dependent on whether the ECB fuels further tightening expectations through statements or new projections, or if an end to the cycle is evident.
Written by urgent.news from FXStreet's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
