Economists at Nomura discuss ECB and BoE outlooks.

Both the BoE and ECB have become more data dependent

“Weaker data and recent less hawkish commentary led to the ECB pivoting in May, and we expect two more 25 bps hikes for a peak of 3.75% by July.”

“Following the latest inflation print, we have changed our call and now see the BoE raising rates by 25 bps at each of the next three meetings.”

“We thus forecast peak rates at 3.75% for the ECB and 5.25% for the BoE. We assume rate cuts from both central banks a little over a year after the last hike (settling at 2.75% for the ECB and 4% for the BoE).”