LONDON (Reuters) – Deutsche Bank said on Friday it expected the European Central Bank to deliver another supersized interest rate increase in October, a day after the central bank delivered a 75 basis point interest rate hike to tame inflation.
“It is likely to be another close call in October and we have shifted our view to expect another 75bp hike (previously: 50bp),” Deutsche Bank analysts said in a note.
They noted guidance from ECB chief Christine Lagarde that rates are “far away” from levels appropriate for getting inflation back to target in a timely fashion and that hikes should be anticipated at the “next several meetings.”
“This underscores the ECB’s insensitivity to the growth headwinds and laser focus on bringing inflation down,” the Deutsche note said.
(Reporting by Dhara Ranasinghe, editing by Karin Strohecker)
