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QT won’t stop rates from rising further

Today’s 50bp rate hike came alongside hawkish comments which are consistent with our view that the deposit rate will peak at 3%, significantly higher than the consensus forecast and a touch above what was priced into the market. The press release also set out a very gradual pace for quantitative tightening, at least to begin with, which is unlikely to have a major bearing on the interest rate outlook.

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