📝Do Not Expect ECB Hikes Until 2H 2027: Nordea

How does Lagarde describe the recent moves seen in the FX market and is the ECB worried about recent currency moves?

We continue to think the ECB will keep rates at current levels this year, and see the risk picture gradually moving towards rate hikes, though as the start of the year has reminded us, downside risks have not disappeared either. We do not expect actual hikes until the second half of 2027, though. Current market pricing suggests a small remaining bias towards a rate cut this year, and the pricing then moves in favour of rate hikes next year.