One more rate hike to go for the ECB?
EUR/USD — All Desk Targets
| Firm | Stance | YE 2026 |
|---|---|---|
Bank of America | Bearish | 1.1200 |
ANZ | Bearish | 1.1400 |
UOB | Bullish | 1.1565 |
From the original
As things stand, markets are well expecting the ECB to stay put in July. Policymakers themselves have confirmed that in saying that only a "negative surprise" to the June inflation numbers would really affect their line of thinking. And as we see with the data, inflation dynamics
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The ECB is expected to maintain its current interest rate, but a surprise hike is not off the table, as geopolitical tensions and rising energy prices create a more complex economic backdrop. Per the full note from ing-think, recent developments could lead some members of the ECB to reconsider their stance as inflation pressures resurface. The desk believes that the governing council's cautious approach might be challenged if data continues to signal persistent inflation, which could play into decision-making dynamics ahead of summer recess.