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Barclays See 50bp Hike Sep But Ultimately Lower Deposit Rate

ECB
  • Barclays have revised their call for the deposit rate to a 25bp hike in July, 50bp in Sep and then a single 25bp in Oct where they see the ECB stopping with the deposit rate at +0.5%.
  • Their previous call saw 25bp hikes at each meeting from July before stopping in 1Q23 with the deposit rate at +0.75%.
  • They see the tightening cycle stopping so soon as they forecast a Euro Area technical recession at the turn of the year with barely positive real GDP growth in 2023.

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