European markets are widening their losses as investors adjust their estimates for the European Central Bank’s next move in the fight against inflation, and are considering a faster-than-expected tightening of monetary policy.
The ECB kept interest rates unchanged on Thursday, despite an inflation rally to a new all-time high of 5.1% in January, with bank chief Christine Lagarde Notes, however, the concern of officials for the jump in prices. Lagarde said the ECB would wait until its next meeting in March, when it had more information, to determine its next steps.
Many analysts, however, have already revised their interest rate forecasts this year, setting the interest rate on zero at the end of the year at -0.50%.
Analysts at Goldman Sachs Group Inc., Commerzbank AG and Bank of America Corp. are among those who revised their forecasts and now see the deposit rate reach 0% in December, according to Bloomberg.
On the board, the pan-European Stoxx 600 index loses 1.2% to 463.10 points.
The German DAX fell 1.5% to 15,136.90 points, while the French CAC 40 lost 0.9% to 6,941.29 points.
The British FTSE 100 is moving with a small loss of 0.1% to 7,521.46 points after the decision of the Bank of England on Thursday to raise its interest rates for the second consecutive time, again by 25 basis points.
This was the first time since 2004 that the central bank has raised its interest rates in succession.
In the region, the Italian FTSE MIB plunged 1.9%, while the Spanish IBEX 35 fell 1.4%.
Source: Capital
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