Published research this week leans toward near-term upward pressure on euro-area interest rates, with a September ECB hike treated as close to a done deal.
One camp of analysts argues that short-dated euro swap rates should drift higher in the coming weeks, pointing to a genuine positive turn in euro-area growth data and an unexpected uptick in core inflation. Their case: don't fade the market's hawkish ECB pricing just yet.
A separate strand of research reinforces this, noting the ECB's own forward guidance has effectively locked markets into roughly an 85% probability of a September hike, with additional moves priced further out — though the same work questions whether those later hikes actually land if growth stays soft.
The interesting nuance is the horizon split. The published consensus for the next few months is rates up. But a longer-dated view stretching into 2027 argues the opposite: with limited second-round inflation effects, the ECB should eventually pivot dovish, pulling 2Y swap rates meaningfully lower.
Tactical tightening now, structural easing later.