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Peak Depo Rate Pricing Hits New Cycle High Above 4.07%

ECB

Following those Holzmann comments eyeing 200bp of further increases (50bp x 4), peak ECB depo rate pricing briefly pushed just above 4.07% for Q4 2023.

  • That marked a new cycle peak, and implies 157bp of hikes from current levels (and no rate cuts in 2023).
  • Peak pricing has since pulled back by 3-4 basis points, but overall: 50bp is basically a lock for March's ECB, with the probability of 50bp (vs 25bp) in May at a little over 70%.
  • A cumulative 125bp of hikes is currently priced through June, with the 143bp through July is 57bp below Holzmann's rate path.

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