Is the market getting too ahead of itself at this point? Schnabel’s remarks here are a contributing factor (although I would argue she’s not saying anything new) but we’ve basically gone from a shift in the timeline from June to April last week and then April to March now today.
The ECB pivot is well and truly on but I’m not sure we’re right up against the turning point already to be confident enough to say that they’re done in the inflation fight in the next three months. But that is what markets are saying now, or at least in terms of pricing.
If major central banks are able to push back and truly keep rates higher for longer, this is going to be one painful exercise for markets heading into the early stages of 2024.