ECB to tighten policy

In the Asian session on Monday (May 8), EUR/USD rose slightly, temporarily reporting 1.1024, an increase of 0.06%. Jussi Hiljanen said the ECB will raise interest rates twice at its June and July meetings, each by 25 basis points, as core inflation is not expected to start falling until after the summer.

“By the time of the September meeting, the ECB may have received enough evidence that inflationary pressures have finally begun to subside and that no further rate hikes will be required after July,” he said. The cut in the policy rate began in March, later than the market expected in February next year.