October 17, 2019 / 10:09 AM / a month ago

Money markets slash rate cut expectations after EU, Britain seal Brexit deal

LONDON (Reuters) - Money markets further scaled back expectations for interest rate cuts from the European Central Bank and the Bank of England on Tuesday after Brussels and London announced that they had agreed a new Brexit deal.

Euro zone money markets have now practically priced out a 10 bps rate cut at the ECB’s December meeting, compared to a 10% chance being priced in on Tuesday, when negotiators were nearing a draft Brexit deal.

The chance of a 25 basis point rate cut from the BoE in December 2020 fell to 60% from 76% on Tuesday.

Reporting by Yoruk Bahceli; Editing by Tommy Wilkes

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