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of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
EUROZONE
BNP analysts have raised their ECB terminal rate forecast to 3.25% from 3.00%, upon an upward revision to their 2023 GDP projection to +0.2% from -0.5%.
- They still see 50bp hikes in Feb and Mar, with a further 25bp added in May.
- Even if the ECB goes just 25bp in Mar, they see rates getting to 3.25% via further 25bp hikes in May and June. And they "still think the market is pricing rate cuts too soon after the peak."
- Unlike some other recent Eurozone growth upgrades (eg Goldman), BNP still sees a technical recession in the eurozone, with a contraction in Q4 2022 (-0.1% Q/Q) and a slightly larger one (-0.3%) in Q1 2023.
- Sell-side upgrades to Eurozone growth estimates are likely to continue, in line with upside surprises to activity over the past few months.
- Consensus is already shifting higher on Eurozone GDP growth, with the Bloomberg median up 0.1pp for 2023 to 0.0% in the latest monthly survey. That's the first increase in the 2023 estimate since the end of 2021.
2023 Median Eurozone GDP Growth Forecast, %Source: BBG Survey
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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