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Major forecasts: It’s all data dependent
Data dependency is the name of the game, as central banks ponder their next steps. We think the most likely path for the ECB remains one of quarterly rate cuts, while we see the Fed slashing rates in December. EUR/USD could fall further. The ECB started its rate cuts this month, the Fed didn’t, but both central banks have made it clear that they remain in a data-dependent mode and have not given clear signals about what will happen at the next few meetings. Central banks will not change their minds based on a single data release, even if market pricing may experience wild swings, as was illustrated again last week ... (full story)