Analysts at ABN Amro explained that they have pushed back our forecast for the first ECB rate hike.
Key Quotes:
“We have changed our forecast for the first ECB rate hike to March 2020 from December 2019 previously. We expect a 10bp rate hike in March 2020 and a second one in September 2020 (with all policy rates moving in synch). The main factor behind the change is the deterioration in the economic outlook.”
“Recent economic data have been weak and the environment for eurozone exports will remain challenging given slowing growth in emerging markets.”
“In addition, the US economy is likely to slow, especially in the second half of next year. Weaker export growth will also hamper investment. Although Q3 economic growth was likely depressed by transient effects in the car industry, we think the slowdown also reflects a broader trend. So in our view, the ECB will lower its economic projections.”
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