Europe

摘要

The ECB, as widely tipped, raised interest rates by 25 bps to 3.25% following the early October meeting of the Governing Council. While there is little doubt the ECB maintains a tightening bias, recent economic events make the communications strategy for further rate hikes more difficult. We continue to expect a further 25 bps rise in December and the call on interest rates rising to 3.75% in Q1 remains a close one, but we anticipate the Refi rate staying at 3.5% for most of 2007.