PIMCO says the next moves from the ECB will be decided by data flow over the coming months. In brief:
- we envision the ECB to keep cutting rates at staff projection meetings
- market pricing seems reasonable and broadly in line with our long-held baseline of three cuts for this year
- we expect additional cuts in September and December
PIMCO acknowledge that risks are skewed towards fewer cuts, mainly on the back of
- sticky services inflation,
- a resilient labour market,
- loose financial conditions
- and ECB risk management considerations.
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Pacific Investment Management Company (PIMCO) is a US firm that manages circa US$2 trillion in assets
From the weekend, the ECB is cranking up 'protect the euro' comments (IMO anyway):