LONDON (Reuters) – Goldman Sachs expects the European Central Bank to raise interest rates by 25 bps each in September and December after policymakers finally acknowledged mounting inflation risks at a policy review on Thursday.
In a report published on Friday, Goldman Sachs strategists expect policymakers to decide in March to end its asset purchase program by June and raise its deposit rate by 25 bps each in September and December.
“Following large upside inflation surprises and yesterday’s hawkish policy pivot, we now look for a substantially earlier ECB exit,” strategists at the U.S. investment bank said in a note and revised its inflation forecasts higher.
(Reporting by Saikat Chatterjee; Editing by John O’Donnell)
