John Fahey: Markets soften bets to see further ECB rate hikes amounting to 1% this year

The market is expecting that rates will peak at 1.25% by mid-2023, and remain at this level into the end of next year.

ECB President Christine Lagarde emphasised that the pace of rate hikes will be data dependent.

Last week saw the ECB raise interest rates for the first time since July 2011 and in doing so, bring an end to its negative interest rate policy that has been in place since mid-2014. 

It announced a 50 basis point, or half point, increase to its key interest rates.