The market expects the U.S. and European central banks to lower interest rates in the coming months. The Fed, according to the players, will start it at the March or May meeting, and the ECB - in April. During the year, they expect 6 rate cuts in the United States and Europe. However, the reality may turn out to be different, reports profinance.ru a warning from Bloomberg.
Recent comments from both regulators make it clear that market participants are too optimistic. Despite the fact that sometimes traders who did not believe the central banks are right, this time it may not happen. The ratio of copper to gold is a relevant signal: in the last few days it has soared to its highest level since the fall. When it is high, it indicates good demand for copper, which indicates a healthy economy. At the same time, yields on government bonds with two-year maturities have fallen and are about 1 percentage point behind October levels. In such circumstances, it would be premature to expect a rate cut soon, the publication notes.