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Goldman Sachs expects ECB to raise rates thrice this year

Published 02/21/2023, 06:47 AM
Updated 02/21/2023, 06:51 AM
© Reuters. FILE PHOTO: The logo of the European Central Bank (ECB) is pictured outside its headquarters in Frankfurt, Germany, December 8, 2016. REUTERS/Ralph Orlowski
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(Reuters) - Goldman Sachs (NYSE:GS) said it was expecting the European Central Bank to raise interest rates thrice this year, taking the terminal rate to 3.5% from 3.25% estimated earlier.

In a note dated late Monday, the brokerage said in addition to an increase of 50 basis points in March and 25 basis points in May, it was estimating a 25 basis-point hike in June.

© Reuters. FILE PHOTO: The logo of the European Central Bank (ECB) is pictured outside its headquarters in Frankfurt, Germany, December 8, 2016. REUTERS/Ralph Orlowski

Goldman's change in expectations comes after hawkish commentary from ECB board member Isabel Schnabel and French central bank chief Francois Villeroy de Galhau, two influential policymakers from the 26-member Governing Council on Friday.

Markets currently see ECB rates peaking at around 3.7% by the end of summer.

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