Nomura says that it expects the Fed to reach a terminal rate of around 3.50% to 3.75% by February 2023 before proceeding to start rate cuts in September 2023. Meanwhile, the firm expects the ECB to hike rates by 175 bps come March next year before starting out with a 25 bps rate cut in June 2023 as a potential recession drags on.

They also chip in with a BOE forecast, expecting two rate cuts in May and August next year after having seen 100 bps worth of rate hikes this year.

This article was written by Justin Low at www.forexlive.com.